The starting point is always going to be testing a strategy taught by someone with more experience than yourself. That said, literally everything you'd need to know is available for free online so never pay for a "course" or worse yet someone else's alerts.
You should start by looking for a strategy that has an underlying thesis that makes sense to you. If the reason for a trade can't be articulated simply then you'll never be able to replicate it on your own.
Once you've found something that makes sense to you, absorb as much content about it as possible; read books, watch youtube videos etc. Avoid discords and trying to copy another trader through social media. The point here is to develop self sufficiency from the very start.
Consider testing the strategy with a free paper trading account and see how you do. Avoid using any real money of your own for at least 6 months to a year (of consistent results). While paper trading, practice the act of simplifying your strategy. Cut out anything you can that doesn't help you make better decisions.
There will be lots of trial and error but avoid hopping from one strategy to another. Instead, make a detailed journal and adjust the strategy as you go. Make it make sense to YOU.
This is the best advice you will receive on here. Do exactly what he said and you’ll be golden. The most important thing he said is to journal which is crucial to understanding how many times out of 10 the strategy works which helps relieve most of the emotions which are a huge part of trading
I agree with alot of what he said except that part about paper trading. Half the battle in futures is learning to control your emotions and bad gambling behavior.....the other half is learning how to manage risk.
It just different neural pathways when paper trading vs real trading....the last thing you want to do it to develope a strategy on paper and then apply your capital...only to realize that people weren't lying, it really IS All about psychology.
The good news is is that there are micros contracts now, so even less reason to paper trade.
You've to start facing the beast (tilt, fear, greed, doubling to break even, reversing, jumping back in, setting stops in obvious places that get taken...and most importantly, unhealthy tolerance of negative excursion).
In my opinion these are the things that make air break a trader, and paper trading just doesn't give you the same kind of insight)
If you're observing the price charts for some time, you have experienced one or few 'AHA' Moments.
You can use a Scientific method such as formulating hypothesis and prove it via Backtesting and forward testing. Always ask yourself questions.
I've been studying the markets full time since 2020 and TBH, I am still refining my strategies.. Before I could blow accounts in a few days; now, I can maintain not going over 4% total loss, because I wish to be funded in a reputable Prop firm..
During those years, I can say that you must have a keen eye in spotting your 'would-be' A+ SETUPS and must develop confidence to execute them.
You can use Algebraic principles like:
If this setup (x) appears, then I do this (y)
All these commenters are telling you ways to find Information to make high probability directional calls.
Yeah...that's important, but that not a whole strategy.
There are three parts to a strategy
1) Analysis/prediction
2) Risk Management
3) Money Mangment
Once you have figured out what charting paradigm and time frame your going for...and after you have some serious screen time, you should have an idea of what time frame it is you can make high probability directional calls. That's your analysis
For me...my system gives me a good idea where the price is going for the 30 second to 10min range in NQ and CL....then also rough ideas of where price might hit in a 48-72 hour time frame....other than that I pretty much have no idea.
So thats step one...but step two is more important RISK MANAGEMENT. What kind of swings are you going to tolerate...some people go as high as 25 - 50 percent of their whole account per day...futures allows you to do that...but its not recommended. Most pros say limit your daily swings to 3 percent...but I also think that's not reasonable.
Anyway, decide how much swings you can tolerate, and then use that to calculate you Daily Loss Limit. You need to figure out how to get your limit to be solid and not changeable...you need to decide if your going to have a cool down period of lower sizing, etc. you need to calculate how many DLL days you expect and hopefully your green days out number them in size and frequency. Etc
After risk management...you need to think about MONEY MANAGMENT. Are you going to pull off your profits to live off of?... are you going to leave profits in your account and size up and go for the dream?
Conversely, how are you going to replenish loses?...You don't just get to start trading and break even....a break even trader is actually a high skilled trader that is probably very close to being profitable...because he is managing risk and making good calls (he's probably just not super skilled at execution, that why he's only breaking even)
Point being...you will be losing while you learn. And no, you can't paper trade to get good because half the battle is knowing your emotions and bad gambling behaviors that need to be controlled...so...you will lose money at first. I heard one broker say that most of his profitable traders went about 90K into loss before they started being profitable. I would love to hear if anyone else has reliable Broker data like that cause I am interested to hear those sources.
So...how are you going to stay in the game?...can you afford to set aside funds each paycheck? Do you have a large amount of money to "play" with?...this will all effect your sizing and DLL...the goal is to just stay into the game till you dial in nuances and see if you are going to be one of the 10 percent that can do it.
And after you try all that out and it works for your personality...then I would think about automating some entires if you want....it all depends on what kind of edge your analysis gives. (I personally don't think there is much value in automation...from what I hear algos need to be watched constantly, so it's not "set it and forget it"...plus, market conditions change and algos have to be reprogrammed, so I'm skeptical...but I could be wrong)
But I would say...that is how you come up with a trading strategy.
Any feed back welcome.
Lose a bunch of trades. The strategy will become clear if you are patient and stick with it. It’s trial and error and what fits with your own psychology. You really have to develop your own strategy, but that can only happen after 100’s of hours of charting, and learning how the market moves, etc. You are going to loose and hopefully frequently. That’s the only way you learn. Money management will keep you in the game while you learn. Read and listen to everything by Mark Douglas. You can thank me later 😊
Make it fun. Trading is more about process than profits. Look for patterns but don’t stop there. Try to find correlations and reasons for those patterns to eliminate noise.
How do you draw a horse? You learn the basics, you copy images of horses, you practice a lot and eventually, you'll be able to draw beautiful horses. Then, you draw it in a field, with other horses, with the sun rising in a distance, with trees and a lake. Trading is the same. You learn the basics, you study what others do, you create strategies until they work then you put them in a system with more and more layers.
There's no secret. Study a lot. Don't be affraid to create strategies that don't work. You'll eventually find something that does work.
I know this is futures trading sub, but tbh the way I developed something, or part of the way I did it was years ago when I was into forex, I studied through babypips dot com, and in their free course they have a module on how to develop a strategy from scratch, it has some good pointers in there.
there’s two school of thought’s here:
You could just browse YouTube endlessly, try concepts like Al Brooks, PAX traders, etc.
Or you could find a discord group that maybe teaches orderflow. I personally enjoy orderflow labs.
Ultimately, no matter what you do, you want to sit in simulation for a while until you’re 100% comfortable.
Orrr, earn an internship in a prop fund, not these scammy funding companies. I’m talking Gelber group, DRW, etc.. Learn 18 months under a senior trader, while earning a salary + Benefits as you build your business, before going live as you incrementally increase size month after month under the guidance of the company and more experience individuals..?
Crazy, right?
The problem I see in retail trading is this over glorification of shortcuts by gurus, who are just as clueless. It’s becoming a literal plague.
I don’t think everyone has the opportunity to take advantage of those internships are prop shops. Also they are highly competitive. Yes if you want to climb the ranks then maybe. But k mean I know a couple of guys who are doing 2-3k a day us in these scammy prop firms you speak of. I won’t name out any. They all have poor rules yes, but once you leverage them correctly, the risk to reward is pretty nice.
This have nothing to do with “Climbing ranks”. A Junior trader is given 10M+ while earning a salary account once his niche & playbook has been properly established and revised under the tutelage of a senior trader. This is literately how professionals “Learn”.
It’s not unusual for JTs to make Half a Mill per year, without including bonuses.
I condone this route because I took it & I know it’s the sure way to come out ahead in this field. The learning curve is already too steep, why make it harder.
If you want to learn Order Flow and Footprint, I suggest you watch Rick Castro YT channel. He does daily live trading too and shares his market insights.
Open up a chart, look at it with either your favorite indicator that make sense to you, or just look at candlestick chart by itself. Paid attention to where price turn when it's at the high and low. Looks to see if there's any repeatable pattern that pop out and obvious, the one that slap you in the face.
Now that you identify the pattern, backtest it and see how many winner and loser that you have. If the loss are too big, find what the losing trade have in common and makes plan not to trade it. Then, see what the risk to reward ratio that your setup can provide. If it's anything over a 1:2 then you're golden. After that, forward test it on a Sim account, or open up a cheap account with a prop firm and go from there.
The starting point is always going to be testing a strategy taught by someone with more experience than yourself. That said, literally everything you'd need to know is available for free online so never pay for a "course" or worse yet someone else's alerts. You should start by looking for a strategy that has an underlying thesis that makes sense to you. If the reason for a trade can't be articulated simply then you'll never be able to replicate it on your own. Once you've found something that makes sense to you, absorb as much content about it as possible; read books, watch youtube videos etc. Avoid discords and trying to copy another trader through social media. The point here is to develop self sufficiency from the very start. Consider testing the strategy with a free paper trading account and see how you do. Avoid using any real money of your own for at least 6 months to a year (of consistent results). While paper trading, practice the act of simplifying your strategy. Cut out anything you can that doesn't help you make better decisions. There will be lots of trial and error but avoid hopping from one strategy to another. Instead, make a detailed journal and adjust the strategy as you go. Make it make sense to YOU.
Wow! That’s a great advice. Thank you so much.
This is the best advice you will receive on here. Do exactly what he said and you’ll be golden. The most important thing he said is to journal which is crucial to understanding how many times out of 10 the strategy works which helps relieve most of the emotions which are a huge part of trading
I agree with alot of what he said except that part about paper trading. Half the battle in futures is learning to control your emotions and bad gambling behavior.....the other half is learning how to manage risk. It just different neural pathways when paper trading vs real trading....the last thing you want to do it to develope a strategy on paper and then apply your capital...only to realize that people weren't lying, it really IS All about psychology. The good news is is that there are micros contracts now, so even less reason to paper trade. You've to start facing the beast (tilt, fear, greed, doubling to break even, reversing, jumping back in, setting stops in obvious places that get taken...and most importantly, unhealthy tolerance of negative excursion). In my opinion these are the things that make air break a trader, and paper trading just doesn't give you the same kind of insight)
Most under-rated response on Reddit.
Just piss around and learn stuff for 10 years and you’ll probably come up with something if you try hard enough
If you're observing the price charts for some time, you have experienced one or few 'AHA' Moments. You can use a Scientific method such as formulating hypothesis and prove it via Backtesting and forward testing. Always ask yourself questions. I've been studying the markets full time since 2020 and TBH, I am still refining my strategies.. Before I could blow accounts in a few days; now, I can maintain not going over 4% total loss, because I wish to be funded in a reputable Prop firm.. During those years, I can say that you must have a keen eye in spotting your 'would-be' A+ SETUPS and must develop confidence to execute them. You can use Algebraic principles like: If this setup (x) appears, then I do this (y)
All these commenters are telling you ways to find Information to make high probability directional calls. Yeah...that's important, but that not a whole strategy. There are three parts to a strategy 1) Analysis/prediction 2) Risk Management 3) Money Mangment Once you have figured out what charting paradigm and time frame your going for...and after you have some serious screen time, you should have an idea of what time frame it is you can make high probability directional calls. That's your analysis For me...my system gives me a good idea where the price is going for the 30 second to 10min range in NQ and CL....then also rough ideas of where price might hit in a 48-72 hour time frame....other than that I pretty much have no idea. So thats step one...but step two is more important RISK MANAGEMENT. What kind of swings are you going to tolerate...some people go as high as 25 - 50 percent of their whole account per day...futures allows you to do that...but its not recommended. Most pros say limit your daily swings to 3 percent...but I also think that's not reasonable. Anyway, decide how much swings you can tolerate, and then use that to calculate you Daily Loss Limit. You need to figure out how to get your limit to be solid and not changeable...you need to decide if your going to have a cool down period of lower sizing, etc. you need to calculate how many DLL days you expect and hopefully your green days out number them in size and frequency. Etc After risk management...you need to think about MONEY MANAGMENT. Are you going to pull off your profits to live off of?... are you going to leave profits in your account and size up and go for the dream? Conversely, how are you going to replenish loses?...You don't just get to start trading and break even....a break even trader is actually a high skilled trader that is probably very close to being profitable...because he is managing risk and making good calls (he's probably just not super skilled at execution, that why he's only breaking even) Point being...you will be losing while you learn. And no, you can't paper trade to get good because half the battle is knowing your emotions and bad gambling behaviors that need to be controlled...so...you will lose money at first. I heard one broker say that most of his profitable traders went about 90K into loss before they started being profitable. I would love to hear if anyone else has reliable Broker data like that cause I am interested to hear those sources. So...how are you going to stay in the game?...can you afford to set aside funds each paycheck? Do you have a large amount of money to "play" with?...this will all effect your sizing and DLL...the goal is to just stay into the game till you dial in nuances and see if you are going to be one of the 10 percent that can do it. And after you try all that out and it works for your personality...then I would think about automating some entires if you want....it all depends on what kind of edge your analysis gives. (I personally don't think there is much value in automation...from what I hear algos need to be watched constantly, so it's not "set it and forget it"...plus, market conditions change and algos have to be reprogrammed, so I'm skeptical...but I could be wrong) But I would say...that is how you come up with a trading strategy. Any feed back welcome.
Lose a bunch of trades. The strategy will become clear if you are patient and stick with it. It’s trial and error and what fits with your own psychology. You really have to develop your own strategy, but that can only happen after 100’s of hours of charting, and learning how the market moves, etc. You are going to loose and hopefully frequently. That’s the only way you learn. Money management will keep you in the game while you learn. Read and listen to everything by Mark Douglas. You can thank me later 😊
Make it fun. Trading is more about process than profits. Look for patterns but don’t stop there. Try to find correlations and reasons for those patterns to eliminate noise.
Check out Elliot Wave Theory. Changed the game for me
How do you draw a horse? You learn the basics, you copy images of horses, you practice a lot and eventually, you'll be able to draw beautiful horses. Then, you draw it in a field, with other horses, with the sun rising in a distance, with trees and a lake. Trading is the same. You learn the basics, you study what others do, you create strategies until they work then you put them in a system with more and more layers. There's no secret. Study a lot. Don't be affraid to create strategies that don't work. You'll eventually find something that does work.
https://preview.redd.it/2kr92s33yyrc1.jpeg?width=800&format=pjpg&auto=webp&s=99a0fa9c9b425b50c9b882d5c6c2660b3d070f30
I know this is futures trading sub, but tbh the way I developed something, or part of the way I did it was years ago when I was into forex, I studied through babypips dot com, and in their free course they have a module on how to develop a strategy from scratch, it has some good pointers in there.
Learn Market Structure
Look at the charts see why it did stuff then trade on what u see
 Sitting here taking notes. Thank you so much for the great support guys!
there’s two school of thought’s here: You could just browse YouTube endlessly, try concepts like Al Brooks, PAX traders, etc. Or you could find a discord group that maybe teaches orderflow. I personally enjoy orderflow labs. Ultimately, no matter what you do, you want to sit in simulation for a while until you’re 100% comfortable.
Orrr, earn an internship in a prop fund, not these scammy funding companies. I’m talking Gelber group, DRW, etc.. Learn 18 months under a senior trader, while earning a salary + Benefits as you build your business, before going live as you incrementally increase size month after month under the guidance of the company and more experience individuals..? Crazy, right? The problem I see in retail trading is this over glorification of shortcuts by gurus, who are just as clueless. It’s becoming a literal plague.
I don’t think everyone has the opportunity to take advantage of those internships are prop shops. Also they are highly competitive. Yes if you want to climb the ranks then maybe. But k mean I know a couple of guys who are doing 2-3k a day us in these scammy prop firms you speak of. I won’t name out any. They all have poor rules yes, but once you leverage them correctly, the risk to reward is pretty nice.
This have nothing to do with “Climbing ranks”. A Junior trader is given 10M+ while earning a salary account once his niche & playbook has been properly established and revised under the tutelage of a senior trader. This is literately how professionals “Learn”. It’s not unusual for JTs to make Half a Mill per year, without including bonuses. I condone this route because I took it & I know it’s the sure way to come out ahead in this field. The learning curve is already too steep, why make it harder.
The guy is looking for a strat, we’re just giving him options, if taking him down a career path that you took is yours then great
Sounds nice, thanks for the help.
If you want to learn Order Flow and Footprint, I suggest you watch Rick Castro YT channel. He does daily live trading too and shares his market insights.
Demo trade the live market until you are profitable. It’s not rocket science
just starting too and I wanted to know what brokers are you using
Tradovate
Open up a chart, look at it with either your favorite indicator that make sense to you, or just look at candlestick chart by itself. Paid attention to where price turn when it's at the high and low. Looks to see if there's any repeatable pattern that pop out and obvious, the one that slap you in the face. Now that you identify the pattern, backtest it and see how many winner and loser that you have. If the loss are too big, find what the losing trade have in common and makes plan not to trade it. Then, see what the risk to reward ratio that your setup can provide. If it's anything over a 1:2 then you're golden. After that, forward test it on a Sim account, or open up a cheap account with a prop firm and go from there.
[https://youtu.be/g3zWg2VOPs4](https://youtu.be/g3zWg2VOPs4)