200 trading hours later, I found something that works for me: "Super-Scalping"

Summary

The video script introduces 'super scalping,' an intense, fast-paced trading strategy focused on micro Nasdaq futures contracts. It emphasizes trading small market movements with dynamic thinking and constant adjustment of expectations. The strategy involves using Average True Range (ATR) to determine order sizes and requires a contrarian mindset, focusing on short-term price action rather than long-term trends. The presenter candidly discusses the mental challenges of this approach, including the need for high impulse control and emotional intelligence, and shares personal experiences to illustrate the strategy's application in various market conditions.

Takeaways

• 😲 The speaker introduces 'super scalping', a unique trading strategy that involves rapid, small-scale trades on micro Nasdaq futures contracts.
• 📈 They emphasize the importance of adapting to the market's immediate behavior rather than predicting long-term trends.
• 💡 The strategy focuses on riding small market waves, using Average True Range (ATR) to determine order sizes and entry points.
• 🤔 It requires dynamic thinking and constant reassessment of market direction, which can be mentally demanding.
• 🚫 The speaker is transparent about the strategy's challenges and does not claim it to be a 'get rich quick' scheme.
• 📉 The approach changes based on whether the market is consolidating or showing meaningful directional movements.
• 🔍 Price action is categorized into two types: consolidation and meaningful directional movements, each requiring a distinct trading approach.
• 🛑 The speaker advises against setting stop losses within consolidation zones to avoid low-probability trades.
• 💼 The strategy is described as being like 'flying a kite in a tornado', indicating its high-risk nature.
• 💭 The mental aspect of trading is highlighted, with the need for emotional intelligence and impulse control.
• 💼 The speaker discusses the importance of being contrarian and realistic with profit targets, focusing on small, consistent gains rather than large, infrequent wins.

Q & A

What is the 'super scalping' strategy mentioned in the script?

Super scalping is an intense and fast-paced trading strategy that involves making numerous small trades by riding the small waves in the market rather than waiting for big structural changes. It requires dynamic thinking and constant adjustment of trading beliefs.

Why does the trader avoid using indicators in their super scalping strategy?

The trader avoids using indicators because super scalping focuses on immediate market noise and short-term price movements, making long-term predictive tools like indicators irrelevant for this high-frequency trading style.

What role does the Average True Range (ATR) play in the super scalping strategy?

ATR is used to measure market volatility and to determine the bracket order size. It helps the trader to adjust the stop loss and take profit levels according to the current market conditions, allowing for more flexible and responsive trading.

How does the trader handle the mental aspect of super scalping?

The trader acknowledges the mental challenges of super scalping, which requires high focus and quick decision-making. They mention the importance of emotional intelligence and impulse control, and suggest that overthinking can lead to poor trading decisions.

What is the trader's view on trading styles that don't align with their personality?

The trader respects different trading styles even if they don't personally align with them, emphasizing that not everyone will be suited for super scalping due to its intensity and the need for a specific mindset that can handle high-paced decision-making.

Why does the trader believe that setting an auto break-even on trades might not always be beneficial?

The trader has found that moving the stop loss to break-even plus a little bit often results in missing out on larger profits, as the trade closes at the break-even point and then continues in the original direction of the trade.

How does the trader decide when to enter and exit a trade in the super scalping strategy?

The trader enters and exits trades based on their assessment of the most likely short-term price movements, using market volatility and price action to determine the timing and the size of the bracket orders.

What is the significance of trading during the market open in the super scalping strategy?

Trading during the market open is crucial for super scalping because that's when volatility is typically the highest, providing more opportunities for small, quick trades that the strategy capitalizes on.

How does the trader approach trading during periods of consolidation versus periods of meaningful directional movements?

During consolidation, the trader focuses on being contrarian and trading the small fluctuations within a tight range. In periods of meaningful directional movements, the approach shifts to following the trend more closely, with the expectation that price will continue to move in the new direction.

What advice does the trader give regarding the use of bracket orders in super scalping?

The trader advises using bracket orders with set targets for take profit and stop losses for each trade, and emphasizes the importance of adjusting the size of these orders based on current market volatility and price action.