I trade a variety of contracts on a daily basis, and use a program that allows me to detect when professional traders are dominating the E-mini trading and when retail traders are trading. Obviously, it's important to stay in a trade when the professionals are pushing the market in one direction; on the other hand, I try to avoid trades where successive retail trading bars are indicated. Why? Large traders are always in control of the market. One thing you begin to notice when using this indicator is that retail traders are generally 2 - 3 bars late to the party. I can generally draw a moving average quantum ai trading using a 50 period EMA and a 20 period EMA and see the cross right on the bar indicating retail traders are initiating trades.
If you are an E-mini scalper, you want to initiate trades as early in a market move as possible. For this reason, lagging indicators and oscillators put traders at a distinct disadvantage. As I mentioned in the opening paragraph, I consistently see the retail traders entering after several bars have passed. In my mind, it is a quantum leap of faith to believe that if the market moves two or three 4-tick bars in one direction it is going to continue for any length of time in that direction. Of course, sometimes you can catch a good trade even when your entry is delayed. However, I would like to be in the trade on the first or second bar.
How in the world can you get in on the first or second bar?
I eschew all lagging indicators and trade only in real-time. Again, I emphasize that I am an E-mini scalper; lagging indicators can work just fine for swing traders, but for scalpers I truly believe that lagging indicators are one of the major causes of the astronomical failure rate of new traders. That's a pretty bold statement considering the vast majority of E-mini trading educators teach their students to trade with lagging indicators, and I frequently get "love letters" from other E-mini trading educators who disapprove of my approach. Of course, I have been an institutional trader most of my life and feel quite comfortable working with real-time data. If you are an E-mini scalper, real-time trading is your key to success.
There are a variety of order flow programs ranging from free to $6000. In my opinion, there is very little difference in the quality of these programs. Some have a few more whistles and bells and are easier to set up, but they all work about the same. Oddly enough, the one I use most frequently is the free one even though I own several of the more expensive order flow programs. With an order flow program I can see the trades up-and-down the volume latter and spot support and resistance with little problem. Further, I can watch traders hit the bid and ask prices in real-time.
Context and probability are what scalping is all about, and seeing shifts from the bid to ask price space (or vice versa) makes my job much easier and I trade more efficiently. Further, real-time volume programs and price analysis, along with support and resistance, give you the ability to understand what is transpiring as you trade. You can easily spot when the price is moving solely in one lot increments and when the larger traders are active. No moving average, or indicator, or oscillator, can give you this kind of data.
Oddly enough, the trading education industry has been slow, downright reluctant, to embrace real-time trading using order flow, real-time volume and other mechanics from real-time trading. I would also point out that I had never seen a lagging indicator until I retired from the institutional trading environment. I was appalled at the tools at my disposal; it was as if Fred Flintstone had designed the crop of trading systems. Professional traders, especially at the institutional level, are quantum ai trading constantly looking at real-time order flow for direction. You should be doing the same.
In summary, I have tried to differentiate the results of lagging indicators and real-time trading. I admit that the current crop of trading educators have been slow to adopt these newer technologies. I think this does a disservice to new traders as they enter the market for the first time. As always, best of luck in your trading.