hello traders it's Samurai trader here welcome to this training session in
today's session we're going to be looking at day trading the NQ futures
contract tick charts vs. range charts we now have hundreds of members around
the world that trade the NQ using tick charts and quite often I'll receive
emails just about how Wiki the tick chart can be particularly in times of
extreme volatility as we've witnessed in the last week so in today's session
we're going to be looking at range charts and how we can smooth price
action and actually make entries easier to recognize of course as with all of my
recordings we need to understand the risk when it comes to trading if you're
not familiar with my videos or if you haven't read this risk disclaimer for a
period of time please do we also are about to go after I go through a couple
more slides go to some charts and I'll give you some chart examples so bottom
right-hand corner you can click on that and go to full screen it may make it a
little easier to view the charts so as we get into this let's consider this for
a moment those that may be watching this recording they're not familiar with the
Nasdaq the E-Mini CME symbol of course is NQ trades in 0.25 percent
increments or $5 a tick it's $20 a point now it's a great market to trade
you've got very very good volume and I like to trade the 133 tick chart for day
trading the NQ during the New York hours during the after our session the Globex
session you really need to drop that timeframe right down because you just
don't have anywhere near the volume and in fact usually during the Globex
session the ym exceeds the NQ as far as volume goes which is another excellent
market to trade so considering the NQ how can we smooth price action because
it can be very whippy very rangy at times you can have the candles or
price bars really very very different sizes etc well one of the solutions may
be for you to consider range chance I really like range charts because they
can really smooth price action now with range chart says with chick charts and
any time frame if you like using time frames you need to consider stops and
the speed of a market of course the low of a time period for an example one
range will each candle form a lot quicker than say a two range so also at
times one range it's just not tradable in my opinion and is the market each
candle is forming so quickly it makes it very very difficult winds of a mark and
also identify trade setups so I really like the 1.5 range over six it's a 1.5
range is a reminder is six ticks okay so each candle is worth thirty dollars and
we'll have a look at this because we need to consider the size of candles
also compared to your stops and a reason being as all of my traders are aware I
like to put my stop two ticks above or below for closest swing high or swing
low and we'll look at that in a moment so typically if we were to look at say a
1.5 range two candles might be I might require two candles to give me my entry
then my stop will be two ticks below there that's $70 and maybe even one tick
higher for my entry to be stopped into a trade so it might be a $75 stop so
that's why you need to really consider the size of those candles if you are
using a flexible stop like that you may have a decide to have a thick stop by
the way where it really doesn't matter that is you might say have a minimum
stop on the or a maximum stop I should say if say eight ticks or 10 ticks and
and by the way I would usually recommend a minimum stop if you're day trading on
the NQ of at least 10 ticks I just tend to find that works really well now if we
consider tick charts they're very very popular of
course we have thousands of day traders around the world here in this particular
case I've got on the chart there 144 tick chart as an example I like as I
mentioned earlier on the NQ for 133 so one candle or a bar will print after
every 144 transactions that is trade to take place irrespective of how many
contracts may be traded within that 144 transactions now another type of candle
I really like particularly on the ES most of my traders are aware I really
like volume charts so each new bar or candle will plot will form after 1000
contracts have been traded now if we consider range bars or candles which is
what we're talking about today that is a new candle will plot once price action
has exceeded a user's predefined price or tick range an example might be an 8 tick
range in this particular case on the NQ which we're about to have a look at now
volume charts rely only on volume range bar charts rely only on price action and
that is why if you're a price action trader you may really like trading with
range chance now all of this of course and a whole lot more is all covered in
the day traders fast-track program so the setups I'm about to talk to you
about particularly for my members are all included in the day traders
fast-track program so please go to my website after recording and request more
information on my course and also my free ebook and of course please make
sure you subscribe to my channel so let's go and have a look at the charts
themselves you know what I have here trade is in front of you is on the left
a 133 tick chart on the NQ and on the right we have a two range chart
so what we've got here and we can just see this like black line here and let me
just go back one can all you can see this white paint bar just they have a
candle right next door is this action right here
so she's then start to take notice of a fall in the market this area here just
look how congested that is and then on the right just notice as I scroll across
over here notice how smooth that is there compared to this which is very
very whippy so as with always traders I recommend that that you always go back
and do your own testing when you're looking at any trading model any
recommendation go and have a look at this yourself but as we go along I think
you'll find these real merits in trading a smoother chart with the NQ something
else you'll also notice perhaps it's not a great example here but you're quite
off to notice here that you're if you've got a very short term MACD for example
the action on that usually is a lot smoother when you're using a range bar
chart because price action has been smoothed out there as well so let me
just expand this chart here now what we can see here is it it almost looks very
very messy doesn't it and the time factor here over on the left here this
is 11:24 in the morning and over here this is U.S time this is a 123 so we
can just see that time range here but it's also very very whippy now for my
members we can see up here we had of course our classic t20 we've got a t3
there we've got a nice t3 up here we've got a t3 bottom down for a nice t7 a
double bottom and this is a classic example by the way traders where I
always like to have my entry or sorry might stop two ticks below the closest
swing low or high so my stop will be two ticks below there you're actually kept
in that trade that ticked down one tick lower than here so you'll kept safe from
the trade if you along there and my stop would be two ticks above there if I'd
have shored it here likewise if I gone long here my stop would have been
two ticks there for our t20 up here my stop would have been two ticks above
there so we can just see how price action is really it's very messy and
this can be very frustrating for traders and if you look at the large candles it
can mean if you are going to place your stop above or below these pivot points
these swing highs or swing lows you can have quite a variance in the stop if you
do want to do that unless you're using a fixed stop concept now if we now go over
and have a look at a comparison to a range chart and what I will do traders
just make sure that we're looking at exactly the same area so let me now go
and have a look at this here expand this out so we can just see here where the
NQ was very very whipping as much as we go into a period of consolidation
here but you can just see it's very very smooth price action here you've got a
t20 you've got a t20 this is of course as with all trading when we see our
moving averages going sideways here horizontally though they're slightly
rising as you can see there you can see we still an uptrend and of course our
longer-term our 200 is telling us that really we should be considering long
trades only so you've got an entry here you've got another entry there you've
got one here you've got one here you've got one there but just notice in
comparison to the NQ here it's just a very very different looking chart the
uptime wise here so we're looking at one what are we here 101 here to those here
okay and just look at that there but that price action there whoops and this
is this is a difference when you've got different types of charts of course that
can very yeah the time period that you're trading or how much you get on
the chart the amount of candles so if we go to the same area here let me just get
this right for you here okay so there is right there now so we can see this
little double bottom which is very very tidy it's what we call it t7 it's very
messy in comparison when you look at that area here compared to this area now
let's go and drop the time frame and let's go and have a look at a 1 range now
one range as a reminder is four ticks or one point so just put one in there we're
looking two weeks back let me just get that up here now one of the things you
may you or you can also do is to do what I've got here is have your tick and a
range chart on the same window or like myself if I have multiple screens you
can have them on different screens but let's just go to this exact same price
action over here so this is each one of these is worth $20 of course and so if
we look at this right here so we can see that point there is this point here okay
so the one range and let me just go here we actually have our traders will know
we've actually got an 89B right here and you can see here you're going to be
in a lot earlier now if you're after a 10 tick target
I liked by the way to go for 12 to 14 ticks on the NQ there you've got 4 10 you've
got about 11 ticks there you still just wanted to stay and that would have given
you about 12 ticks from there to there in this move now if you're a true
scalper you can see here with these are trades here you've got a nice scalp
there a nice scalp there a nice nice scalp there let's just expand this out
you've got a t20 this is that dangers I think as always traders you want to be
more cautious of of course the NQ though usually when you get some trends you get
some really nice trends so you've got t20 you got a 34b of course you've got
there t20 again 34B so this in great trades here the
problem is is the time in trading ES if we look at this here right now this
isn't all this is what do we got 146 to 236 this is about an hour's price
action in that timeframe so let's just go and have a look at one more here if
we go back let's have a look at the 1.5 which is a whoops 1.5 range which means
that each candle is worth $30 so as far as in your stops go if we look then here
and this is let's just have a look here and this is really interesting traders
if you look at this price action right here now you can see the 133 look at the
size of these candles and what I am going to I'm gonna change the time frame
because this is at the end of a trading day so I don't like to trade the last
hour you can be all over the place so let's just go back to another time
period which is just gonna make it more realistic in trading let's just go back
here and let's look at this here okay so over here of course we've got our thirty
dollar candles if we can call them thirty dollars for a moment and you can
just see how much smoother you are on a range chart and also notice here that
your if you're particularly trading with a short term MACD it's how much
smoother it is in comparison it's because of the candle formations of
course so with the strategies of the day traders fast track program of course
having candles like this this is an nice t3 here's your entry right there
can I so let me just mark this up here and have a look at on the range charts
okay you can to see how much messier from there okay there to here compare us
in comparison to a tick chart so traders go back in and do some testing and by
the way then you'll stop if you're entering this one because your entry
isn't clearly signaled here on this t3 to we close up above here right
there you stop there's probably going to be around the sixty five seventy dollar
mark if you take my recommendation of two ticks explore
swing high swing low there of course you have another nice little lot t1 entry
so traders hopefully this has been official so well I really believe it
range chance have some real merits in trading the NQ once again please
subscribe to my channel drop me an email if you've got any questions to find out
more about the day traders fast track program please go to my website even
better still invest one hundred ninety seven dollars and purchase the most
comprehensive day traders program that I know of thank you traders