Summertime Trading – Whats it All About?

Summertime Trading

Summertime trading time again! Is it good or bad? Neither really. What trader need to understand is that summertime trading is just different. For newer traders, it could spell large losses as they fight to trade the same method in market moving differently than they are used to. There’s little question that to profit in the summertime something has to change and unfortunately for us, we are the ones that have to change our approach.

Grains traders are better equipped at changing their trading to meet ever-changing conditions, such as the seasons and the weather, which can have a dramatic effect on the markets they trade. For everyone, the summertime trading is a challenge. People are on vacation. Volume and volatility are low. Markets are choppy and directionless.

Many traders believe that very short-term trading AKA ‘scalping’ is an advanced technique, only to be practiced by trading wizards. In the professional world, many proprietary trading firms teach their traders to scalp BEFORE allowing them to use longer term trading techniques. In many prop firms, the traders aren’t even allowed to use charts in their trading. With the lower volatility in the summertime, these shorter-term opportunities are often the only trades available for many hours.

Summertime Trading Suggestion

image of summertime trading suggestion lampsWe are going to suggest that you look at scalping during the summertime. If you are watching the markets this summer, then you’ll no doubt have some periods of boredom. Many traders end up taking ‘boredom trades’ at these times, our suggestion to you is that you use this time to develop your scalping skills. You have time and you have opportunity.

One advantage of scalping is that it is not ‘predictive’. You are not trading based on what the market is going to do. You’re trading based on what it is currently doing and you are observing what’s happening right here, right now and trading the moment. This is in total contrast to what most traders are trying do to – figure out where and when the market will turn around.

Another advantage of scalping is that of repetition. The more you do something, the better you get at it. You get to experience more trades per day, which accelerates your reading of the market compared to taking 1 or 2 trades a day ‘top and bottom picking’. This does presume that you are recording your results and journaling your entries and exits. You will progress with higher frequency trading only if you are recording the results so that you know what works for you and what doesn’t.

As the markets have a tendency to slow down in the summertime there are other good reasons to consider scalping. You will often see decent volatility at the market open and then things slow right down, momentum grinds to a standstill and the markets revert to a more relaxed pace and form tight ranges. These periods are the perfect times to develop your scalping skills. With the market being less frantic you have more time to make your decision. Using market-reading tools like the Jigsaw Trading DOM (Depth & Sales) and Auction Vista, you can enter the market with pinpoint accuracy.

Where to Begin your Summertime Trading

So where to begin. Well you can only begin at the start. Trading is a journey not a race. It is a skill not a science. Some would say an art. Our recommendation is to start with the following videos. First, a video from Alex Haywood at Axia Futures (a London based proprietary trading firm). In the video Alex offers an enormous amount of knowledge and information on how to read order flow in numerous environments. This video is from a webinar hosted by the futures.io forum that was sponsored by us here at Jigsaw…

The next video is an overview of a number of common scalping techniques. Techniques that are used every day by professional traders

Lot’s of traders are skeptical about scalping but you really have nothing to lose over the summertime trading period. If you are trading anyway, you will need to do something to stay entertained. Scalping sure beats Facebook….  Check out our Showcase Page on My Trading Buddy to see what we do, Just 

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Jigsaw Trading
After suffering a 30% drawdown at the hands of “independent financial advisors”, Peter started trading in the early 2000’s, figuring there was no point in paying people to lose money for him. By 2005, Peter was day trading NASDAQ stocks and later discovered the value order flow. He struggled with the way order flow data was presented so designed tools that organized Order Flow information more rationally and Jigsaw Trading was born. Those tools are now the #1 ranked software on Investimonials.com.
Today Peter spends his time trading and helping other traders through the Jigsaw community, articles and free one on one sessions.
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Jigsaw Trading

Jigsaw Trading

After suffering a 30% drawdown at the hands of “independent financial advisors”, Peter started trading in the early 2000’s, figuring there was no point in paying people to lose money for him. By 2005, Peter was day trading NASDAQ stocks and later discovered the value order flow. He struggled with the way order flow data was presented so designed tools that organized Order Flow information more rationally and Jigsaw Trading was born. Those tools are now the #1 ranked software on Investimonials.com. Today Peter spends his time trading and helping other traders through the Jigsaw community, articles and free one on one sessions.

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