Emini S&P Real-Time Trading Assistant Explained

Emini S&P (symbol ES) and its closely related Spyder ETF (symbol SPY) have many real-time biases that provide important clues on where they are heading within the day. These real-time biases often change the expected outlook for the day. This should not be a surprise as Emini S&P is no different from other markets that they are all probabilistic in nature.

Augment Our Trading Skills

This is the main reason for the development of the Real-Time Trading Assistant. As the day progresses, the possible scenarios keep changing. Sometimes it is pretty easy to figure out what the charts are telling us. Other times it is difficult to interpret the charts when so many factors have changed since the beginning of the day. It is much easier to let the computer do the job giving us a checklist of biases that are in effect at the moment.

The goal is not to force you as the trader to take the suggested mechanical trading signals. We are not necessary comfortable with all the trading setups suggested by the computer AI. It is, however, useful to be aware of the possible scenarios we have not pay enough attention to.

Utilize The Trading Signals Mechanically

Some traders prefer to keep things simple and focus on one to two trading models they are comfortable with and follow those signals when they happen. It is perfectly find to do that too. The most important thing to remember is that when you choose to follow a mechanical signal, you have to be consistent.

Hence, you must develop a trading plan based on the trading models I have presented here. You need to work out which ones fit you best. You can then backtest the ideas so that you can understand the strength and weaknesses of these signals more intimately. The backtesting exercise itself will help you strengthen your will to follow your trading plan religiously.

On the money management aspect of trading mechanically, please read the Defensive Money Management series. It will help you build a solid foundation in basic concepts of money management.

Open Design Allows The Tool To Grow With The Market

The real-time trading assistant is designed to be able to grow with the market. Unlike a static trading system, the open architecture allows for continuous expansion of trading knowledge to be added to the tool. Since we all know the market evolves over time, it is important to keep exploring and discovering new trading patterns and rules to improve our trading odds.

The real-time biases, trading setups and trading signals across all the research reports will be implemented into the Real-Time Bias Reporting Tool. As more research reports are written, the reporting tool will continue to grow and expand in its functionality and usefulness. The idea is to expand your understanding of the market through the reports without the burden for you to recognize all these real-time scenarios manually.

Distilled Information Is Better For Intensive Decision Making Processes Like Trading

It is a known fact that human makes more mistakes in stressful situations. Decision making in real-time in a fast paced market is a stressful activity by itself. So many things to consider with almost no time to react. Every mistake can be costly and hurt the bottom line.

This is where real-time bias reporting outshines normal trader tools like charts and price ladders. Real-Time Trading Assistant offloads a big chuck of interpretation burden from the trader. Complex market conditions with known statistical bias are reported to the trader quickly. No need to guess if certain scenarios have happened any more because you already know exactly what the current conditions are.

You can think of the Real-Time Trading Assistant like the cockpit of a plane while you are the pilot of the plane. You do not need to be an engineer to fly the plane. It will be helpful if you understand more about the plane or aeroplanes in general. The extra understanding can help you learn to fly the plane better but not necessary. You don’t need to know every single detail about the complex flight system (and the jet engine) before you learn to fly. You just need to know what to do based on the real-time feedback from the instruments in the cockpit and operation techniques to manoeuvre the plane.

That’s the purpose of real-time bias reporting – allowing traders to focus on making proper trading decisions by delivering objective scenario analysis of the market in highly distilled format.

No messy indicators. No flipping of multiple charts to look for information. Just focus on one thing – trade.

List Of The Real-Time Biases And Trading Signals

Due to the need of providing a compact structure for real-time biases and signals delivery, each setup has to be code named. We are experimenting with various reporting styles at the moment. Feedback from users will allow us to further refine the reporting tool going into beta release.

Following is a list of the trading setups to be included in alpha release:

Trading With Tick Index: Early Detection Of Trend Buy Day

Volatility Snap: VIX Based Always In Trading Model

Intraday Bias: Emini S&P Runaway Long

Intraday Bias: Emini S&P Easy Top

11 AM Bias

1 PM Bias

Following are trading systems and trading setups planned once alpha release works smoothly:

Opening Breakout Models

Opening Gap Play Setups

Tick Divergence Signals

July 24, 2014 Update
The list of active trading biases and signals is now available at Emini S&P Patterns Library.

Share