What Is The Formula For Finding The Break Even Point 3 Solid Techniques for NQ Trade Entries

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3 Solid Techniques for NQ Trade Entries

Nasdaq Futures ( NQ ) generally trades like most other stock indexes, although it has a few twists and turns that set it apart from the crowd. For anyone who has traded seriously, it is these twists and turns that can cause trouble for the layman when trading NQ. The purpose of this article is to alert traders to some of the peculiarities that are part of trading NQ and how to adjust your trading to take advantage of the attractive parts of the contract and avoid some of the less pleasant outcomes of this instrument. may cause.

Sometimes this contract is very easy to trade, especially if it is trending. Sure, you can say that all contracts are easy to trade during trends, but NQ (due to volatility) presents unique challenges and can be profitable if you trade the contract correctly. The challenge of trading NQ is to understand and profit from the volatile nature of the contract. This can be a double-edged sword, and the downside of volatility is the tendency for prices to move against your position at high speed.

In a normal “bracketed” market, you can let the trade run against you to some extent depending on the size of your trading account, but sooner or later (it can be days, weeks, even months) a price action breaks out and trading if you let it run becomes your worst nightmare. The best overall approach is to trade this contract conservatively and with the trend.

Countertrend trading is a formula for blowing NQ trading accounts. You should repeat this mantra 25 times before going to sleep every night. “I don’t trade against the trend, I don’t trade against the trend…”

Here are the techniques that have been successful for me when trading the Nasdaq:

· Reversion to the mean: Like most contracts, the Nasdaq is a great contract to trade using a technique called “Reversion to the Mean.” This strategy generally discourages traders from taking those dreaded breakout and breakout trades that are often the cause of many losses. I generally wait until the price is between 2-3 standard deviations from the backtested SMA and find this trade phenomenally successful. I added some game changing rules to further quantify the trade and increased the win rate by another 15%. I strongly recommend that you look into this less popular trading style and see how successful it can be.

· Pay special attention to support and resistance (SAR): As I mentioned at the beginning, NQ is a very active contract and making initial assumptions about whether the price will move through the SAR or not is a mistake. A better idea would be to use an order flow program so you can see the actual order flow in SAR. Either the traders hit the buy side or the sell side, or the orders representing the traders are on both the bid and the sell side.

· Volume analysis: By now, most traders have realized that increased SAR volume generally causes the SAR market to pull back. The bottom line is true that an approach to the SAR in small volume may indicate that price is continuing through support/resistance. I highly recommend using the “Better Volume” indicator to show the nature of each bar in real time. Obviously, a high SAR volume often indicates that there may be a change in direction on the charts, and a low volume signals a possible continuation of the move. The question has always been, “How high should the volume be to indicate the opposite direction?” Obviously, a high SAR volume often indicates that there may be a change in direction on the charts, and a low volume signals a possible continuation of the move. The question has always been, “How high should the volume be to indicate the opposite direction?”

Is there a method to find the “perfect” NQ entry point? No, not that much. But you can get good enough to read between the lines and consistently score winners. Good luck in trading.

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