Many ways to benefit from trading Index Futures using *PPTA Analysis
Out of so many ways of identifying trend, let's pull out *PPTA from our indicator tool box.
PAPLines is a "MUST HAVE". We use this as profit taking level as well as taking it as a guide to identify market exhaustion so that we can also do "swing trading".
The chart below shows Nikkei 225 on Jun 10, 2016 (Friday). When pink is below purple and blue zone, it is in down trend. Since it is in down trend, our main focus on market opening is to look out for sell opportunity.
Nikkei 225 open at 7:45am Singapore time, an autumn signal appear at 8:00am at purple sell zone, a fantastic setup.
Entry is important, so is exit. We shall collect our profit at PAPLine-S1. That would be 18 tics profit. Base on current USDYen exchange rate, it's about USD22 per tic. For a fresh newbie, you can start small by trading 3 lots, that would be USD1,188 for this trade.
After the first down move, the natural reaction for market is to "pull back" to *PPTA sell zone, we can then take advantage of this market behavior to perform "swing trades (#2 to #4)".
Why do Olympic athletes do the same exercises endlessly over and over again? It is because they are training their brains and their bodies to constantly improve and perfect their skills. Athlete call this "muscle memory", this work for traders too.
A trader must repeat the "correct exercise" over and over again, not the incorrect exercise.
A new trading week is starting, hope this article help you to plan your mind before you start your new trading week.