- Short-Term Trading Strategies That Really Work | The Smart
- Best Short Term Trading Strategies - Average True Range
The formula for the ATR is very simple: Wilder started with a concept called True Range (TR), that is defined as the greatest of the following: Method 6: Current High less the current Low Method 7: Current High less the previous Close (absolute value) Method 8: Current Low less the previous Close (absolute value) One of the reasons Wilder used one of the three formulas was to makes sure his calculations accounted for gaps.
Short-Term Trading Strategies That Really Work | The Smart
The 75 day fade remains one of the most profitable and one of the best short term trading strategies I have ever traded, and I have traded just about every strategy you can imagine.
Best Short Term Trading Strategies - Average True Range
We got our entry, but we still need to determine where to place our protective stop loss and take profit orders. This brings us to the next step of our short-term trading strategy.
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Pennants follow the same rules as flags, but they look more like symmetrical triangles. However, prices in pennants do not need to touch the trend lines several times, such as within a triangle. Usually, a strong price rise/fall happens before prices slightly correct within a pennant pattern.
The flag & pennant patterns are usually considered continuation patterns. The flag has the shape of a rectangle, as you can see on the following chart. On the other hand, a pennant is very close to a triangle.
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The Stochastic on the other hand tends to work better with short term market swings that are not meant to signal market tops or bottoms but only a slight change or a correction in the trend.
Always be patient, dedicated and well organized while trading. Short-term trading doesn’t mean that you have to trade every single day. If the markets do not offer any profitable and clear trading opportunities, don’t try to create any opportunities that aren’t there.