Market Adaptive Trading Techniques : Summary

MARKET ADAPTIVE TRADING SUMMARY

A summary of the techniques I use in market adaptive trading:

• Understand market statistics so you know if current conditions are favorable or high risk.
• Develop multiple trading systems and carefully test them in all three types of market conditions.
• Use trend lines to help determine the current market conditions and select the appropriate trading tools.
• When the market breaks a trend line, become cautious. Reduce holding times, position sizes, and number of trading positions until the next move is clear.
• Avoid trading when the market is in a narrow basing area.
• Have a clear idea of where NASDAQ support and resistance are and concentrate trades around these areas.

The market will not adapt to us, so we must adapt to it. The way to get started in market adaptive trading is to use backtesting and experience to develop knowledge about how the market usually behaves in a given situation. Based on this knowledge, traders can position themselves to profit if the market does the usual thing, which by definition it does most of the time. Remember to plan the trades, and trade the plan.