E-mini Scalp Trading for Beginners Explained

Day traders attempt to make money by buying an asset and then selling it later. Traders typically do this for days at a time, and often multiple times during the day. Long-term investors buy and hold for months or years at a time. The term "scalper" applies to day traders who hold trades for the shortest duration - typically minutes, seconds, or even less (for automated scalping algorithms). Some scalpers execute trades hundreds of times per day. Their goal is to accumulate small profits for a large reward. One of the drawbacks to scalping is that a trader has to be aware of the market at all times and be ready to place a trade at any moment. Commissions can also stack up because they are typically applied per trade, per contract. Low commissions are a priority for scalp traders.

DayTradeToWin's Trade Scalper is different from other scalping strategies. With the Trade Scalper, there is no need to have multiple positions open at once. Also, the number of trades per day is reasonable. On average, eight to twelve E-mini trades in the morning session occur. Also, John Paul, the founder of the company, recommends using the NinjaTrader platform. NinjaTrader is now a brokerage (NinjaTrader Brokerage) and provides low rates, which are ideal for scalping. NinjaTrader also provides Level 11 data and 1-min charts, which are utilized by this particular scalping method. Scalping has an advantage over other strategies in that it's designed to keep you in the market for a very specific, short duration. This is good because the longer you're in the market, the greater the risk. Having a clear-cut exit strategy is necessary.

The E-mini is a great market to scalp because of its value. Each tick is worth $12.50. Each point (four ticks) is therefore $50. On average, the Trade Scalper has you going for 2 to 4 ticks on each trade ($25-$50) with a maximum stop loss of six ticks ($75). NinjaTrader provides a full practice environment with live data. This allows you to get a sense of how the Trade Scalper is traded without risking real money. Using the report feature, you can get an idea of your simulated performance and factor in any broker commission fees. If you're a high-energy individual or like staying active with your investments, scalping is going to be appealing.

The Trade Scalper indicator for NinjaTrader produces two types of long signals: regular Longs and Shorts as well as Dbl Wick Longs and Shorts. The differences between them are taught in the included live training. Text signals are accompanied by directional triangles. They signify the entry point at which you want to be filled. NinjaTrader's ATM Strategy feature allows you to define a profit target and stop loss value ahead of time, thus allowing for quick entry. Utililizing NinjaTrader's Chart Trader lets you see the profit target on the chart as well as the stop loss. You can click and drag these green and red lines as needed. Keep in mind that adjusting the profit target and stop loss will put you in the back of the line, so to speak. Only adjust these values if you absolutely have to.

Scalping the E-mini Using Trade Scalper Price Action Method

New day traders should take some time to first understand the basics of their trading platform. Knowing how to place a trade, manage a trade, and then exit is vital knowledge. Also, making sure your charts are functioning correctly every day with live data is important. Once the trading environment becomes familiar, it's time to start tinkering with the markets. The goal of course is to find profitable trades. While no trading method can guarantee performance, the strategies taught by John Paul at DayTradeToWin show you how to limit overtrading - trading too much or using very large stops. For many traders, this is helpful because it teaches discipline. It's tempting to place large trades in volatile markets because you know that there is a chance the market can produce that big winner. Instead, John Paul believes being conservative and following an exact plan is better in the long run.

One of the ways to be careful in the market (instead of placing random trades and hoping for the best) is to apply the strategies of a day trading course like the Trade Scalper. The Trade Scalper is exact with the goals and risk: a profit target of about 2 to 4 ticks is used on average. The stop loss is a maximum of six ticks. No matter what, you will try to get out of the market with a loss of six ticks (excluding any broker fees).

As seen in the video, the Trade Scalper software produces signals that tell you to go long or short depending on the market's price patterns. Two types of Long and Short signals can appear: the regular kind and the Dbl Wick. The Dbl Wick signals appear when there are two consecutive wicks. More details are taught in the included live training and downloadable course. Scalping the markets is all about timing - you want to get in and out as quickly as possible. The retail version of the Trade Scalper indicator (not shown in the video) helps in this regard because it plots horizontal and vertical lines on the chart, letting you know when a trade is likely to occur. You can get your ATM Strategy ready (select the pre-configured template that matches current market conditions) and you're set. It's just a matter of following the rules and hoping the market will be consistent.

8 Points from Multiple Atlas Line Trades and Live Signals in Webinar

On the night of Election Day, Nov. 8, 2016, the E-mini S&P dropped over 120 points. This crash occurred when Donald Trump began dominating the Electoral College. Trading on or around Election Day is almost always volatile, but in this case, the unexpected truly happened. For months prior, nearly every poll consistently predicted Hillary would win by a landslide. The opposite happened, and when it became clear the likely president would be Donald, the market reacted. Markets "like" stability. When a controversial figure becomes leader of economic policy and the Republican party retains control over the Senate and the House, the market is likely to remain unstable. Despite the crash, the market recovered the next day, Nov. 9 and has been within fairly normal ranges. The abnormality comes from how regularly high the ATR has been. This is what John Paul focuses on in this webinar video:

His favorite tool for assessing volatility is the ATR (Average True Range). It's not a tool for direction. It averages the highs and lows of the last X number of bars (we prefer four) and provides a value and a line on the bottom of the chart. When the value is between one and four points, the market is good for trading. Above or below this range indicates too little or too much volatility. The ATR is a measure of "how far the market can move in a given moment," according to John Paul. As such, he uses it to determine the profit target and stop loss for each trade. Another way to manage risk is to use trailing stops. At around 45:00 in this presentation, John Paul shows how trailing stops trail the profit target to lock in a smaller loss, breakeven, or even a smaller profit. It's tempting to trade during volatile conditions because you may expect the market to reach over three points on one trade. That can be a lot of money. A trailing stop, if executed correctly, can a sort of parachute. NinjaTrader has a built-in feature for trailing stops. You can also manually manage your stop by enabling ChartTrader and using an ATM strategy. This shows the red stop loss line on the chart and allows for custom placement.

Check out the video above if you just want to see the Atlas Line trades from the webinar. There were three really nice trades here. Remember that John Paul often uses 1 * current ATR value (with ATR set to 4). First, a trade worth 2.5 points. The entry was at 2164.24. The market was volatile enough to go four points in the profit taking direction. Next, a trade worth 3.5 points with a signal at 2162.50. Again, the market pushed on through the target. It's better to be conservative and stick to the rules. The third trade, a long, occurred in the afternoon. That trade was worth two points with an entry of 2158.75. Remember the Mentorship Program provides the Atlas Line with a lifetime license. All of the other courses and software are also included. Training is twice a week with John Paul. His goal is to make you into a professional trader.