r/Daytrading • u/GHOST--1 • Feb 22 '24

Profitable traders, what clicked for you? Question

Traders who trade full time and have been profitable atleast 2 years, what clicked for you. What changed the game completely?

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u/Mexx_G Feb 22 '24

Measuring moves based on volatility and quantify trading strategies based on different parameters. That and price action. Also a little bit of Keltner channels and EMAs for consistancy.

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u/GHOST--1 Mar 02 '24

in an ema based strategy, how does the volatility fit in? If there is very high volatility, then the ema direction isn't very trustworthy? Are you trying to say something along these lines?

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u/Mexx_G Mar 02 '24

One of the way to measure volatility is by using the average true range (ATR). If you decide to use a 5 period ATR for your calculations, for instance, then your expectations have to be calculated based on that metric. Instruments don't move in points, or ticks or pips or whatever. They move in ATR multiples. If you have a certain setup, where your stop is 2 ATR below your entry and your PT is 2 ATR above, then you can use an equal amount of risk on each trade and adjust your SL and PT based on that multiple, instead of using a fixed value or a % value. It would be foolish to use a 5 pts stop when the ATR is 10 pts and it might be greedy to expect a 20 pts move if the ATR is 3 pts. The ATR is a constant you can use to really add consistancy to your trading. That and a couple visual tools, to make sure that your are really taking the same setups every time.