Mistake: No Specific Way to Replicate Results
The Begging Trader’s Day Trading Indicators
If you’ve been exposed to trading for less than two years, most still consider you a “begging trader.” Every trader has made their way through this awkward phase. It can almost be considered a right-of-passage.
But while each trader has to go through it, each trader also has to overcome it.
Success by Day Trading Indicators
If you currently fall into this “begging” category, please understand that merely signing up to use trading software is not what will help you find success moving forward. Simply knowing basic indicators and how to buy and sell does not make you a professional trader. While this software can be a vital part of trading strategies, it should never make up the entire strategy on its own.
What type of returns do you expect to see if you’re only using free indicators and trading tips? Instead, these resources are best used in addition to other resources that make up a trader’s personal strategy as a whole.
Different Types of Day Trading Indicators
As you begin your search to find the best set of trading indicators, you’ll likely find only a few reputable companies offering proficient systems compatible with modern, updated charting software. Some of these companies even customize their indicator software for individual customers.
It’s important to remember that while this sounds like a perfect scenario, success can never be guaranteed. That being said, these companies can at least help you come closer to finding a way to replicate results.
Free or “Lagging” Day Trading Indicators
However, advanced traders consider these to be “lagging” indicators due to how easily it is to take advantage of traders who use them.
Another issue with these “lagging” indicators is a slower response time to the signal. This is because many advanced, savvy traders have built upon them to create and innovate modern methods to stay ahead in the game.
This can be frustrating for “begging traders,” but the truth is that even with custom-designed indicators, replication is still a distance off. Traders may see consistent success, but it’s near impossible to develop indicators that can replicate specific trades based on specific market conditions.
The true success of a trading system can be measured and replicated only to the point that others are willing to test its validity.
Fibonacci and Retracement Day Trading Indicators
Fibonacci’s retracement principles are now common among traders. These principles have been rebranded often for sales, but the main function remains the same.
Some of these attempts to rebrand include Pivot Point, Prediction Points, Sing Marks, Buy/Sell Levels, Trade Levels, etc. Watch out for these old and free techniques rebranded as modern when developing your own system.
All warnings aside, Fibonacci’s tools can greatly benefit traders if used correctly and in addition to other resources.
There are enough uneducated traders willing to “donate” their money to the market. Let them.
Other Enticing, Potentially Destructive Trade Tools
Some traders use trading announcements as the deciding factor on each trade. Making trades based on the assumed market reaction to currently unfolding events is likely the oldest trading strategy there is. However, it may also be the most dangerous.
The issue with trading announcements is inconsistency and unpredictability. Many have witnessed announcements with similar context to past announcements, but significantly different results.
Some of these announcements can be traded on their own (slam dunks). But remember that it can take years before a trader is experienced enough to differentiate between market reactions.
Just like other tools, announcements can be beneficial when used in addition to their other indicators. Making trades based solely on these announcements can pay off, but the numbers are against anyone making the attempt.
Trade Systems Based on Results
It is perhaps most difficult to find a trading system based on actual results. You may find systems that work with announcements and others that work with indicators. The question to ask yourself is if they are making money.
This question may be harder for you to answer than you realize. It is best to take testimonials with a grain of salt. There are some outlying trading companies that even claim to base their trades on the moon’s gravitational pull. Even these companies will have testimonials from “clients” who claim the system works for everyone.
It is likely you’ll experience at least some success in each system you encounter. This success is common and hard to take with a grain of salt. But to truly avoid the scams, make sure to do your research. Give each system you experience the time and preparation necessary to determine actual credibility.
Day Trade FEED’s Day Trading Indicators
Here at Day Trade FEED, we use a specific set of indicators in our day trading system. After years of research and trial/error, we’ve incorporated Kevin Jones Day Trading Indicators into our trading system.
Traders have been using these indicators for more than 20 years, and so far they’ve worked perfectly for us in our trading.
This article is only part two in a series aimed at helping day traders understand what mistakes to avoid. Subscribe for future editions.