Must Read Tips For Best Results With Our Indicators
The key to getting amazing results with our indicators is using them properly. So here are some tips that I highly recommend you try to ensure you are getting the best possible signals, making great decisions and maximizing your win rate.
Make sure to check out the Tutorials Page we have to learn about trading as well as how to use our indicators. Please make sure you watch our video tutorials as well.
If you are going to use our external indicator filtering features, here is an updated list of what indicators you can currently use for filtering and how to set that up.
Specific instructions about how each indicator works can be found by going to the dedicated page for each indicator and reading the instructions. You can also go into the settings panel for each indicator and hover your mouse over the ‘i’ icon next to each setting and a popup will appear with an explanation of what that setting does and how it affects the indicator.
1. All 3 of our signal generating indicators (Trend Friend Swing Trade & Scalp Signals, Buy Sell Indicator and 1 Minute Scalping Indicator) perform very well, but they all have slightly different algorithms. Trend Friend Swing Trade & Scalp Signals uses a combination of tons of indicator calculations to give signals and will provide the earliest entries, but will also give more false signals due to how quickly it reacts. The Buy Sell Indicator and 1 Minute Scalping Indicator both use price action, custom candle pattern formulas and analyze a certain number of previous bars to calculate signals. These methods of calculating signals are generally more reliable, but they won’t always catch the very first candle of a reversal except in some situations.
2. The combination of indicators you use is completely up to you and is all about personal preference and finding what setup works best for your unique trading strategy. Test each indicator out by going through historical data and seeing what combination of indicators and settings you like best and then stick with that. Once you figure out what works best for you and your unique trading strategy, feel free to reach out with any specific questions about your setup or adjusting settings to get the indicators to do something specific better. If you are not sure what strategy you want to use, read through this article on different day trading strategies and then click the links to the individual articles with in depth explanations about each different strategy.
3. Remember that there will never be an indicator or combination of indicators or settings you can pick that will give you amazing results 100% of the time. Everything in trading will perform well under certain conditions and then perform poorly as those market conditions change. You as a trader have to learn to recognize these market changes and stop trading until the right market conditions return. If you cannot do this and cannot be a disciplined trader, you will not be a profitable trader. Trust me, I have tried it all and discipline is more important than anything else in trading, so be patient, study the charts, learn to recognize when not to trade and then execute according to your plan and do not deviate from your plan if you want to be a successful trader.
4. In my opinion, the safest way to trade is to trade with the trend, hence why I named the company Trend Friend. But as I mentioned in the previous paragraph, you need to wait for the market to actually be trending before you start trading with the trend. If the market is ranging and you try to trend trade, you are going to get stopped out. Wait for price to break above the previous daily high/low and preferably the previous weekly high/low as well and establish a strong trend before trying to ride that trend. This is where you will get the easiest trades with the highest win probability. Use our Trend Strength indicator or our Trend Trading Indicator to help you identify these trends. You can also use our Higher Timeframe Candle Levels indicator to identify these levels that need to be passed before a real trend will begin.
5. Learn to identify what it looks like when the market is actually breaking out of the previous daily or weekly high/low and continuing on or if it is just a liquidity sweep that is taking peoples stop losses just to turn around and come back inside of the trading range. Actual breakouts will usually come with decently high volume to support the breakout. They will also usually go beyond those high/low levels and then retest that level before continuing the breakout which is where you want to enter the market. Use our signal generating indicators to help you confirm your entries for this type of move. If you can learn to avoid the false breakouts, then you will help improve your win rate and become a much better trader. We also have an article about liquidity sweeps that you should read to help familiarize yourself on the subject.
6. Understand the difference between trend trading and reversal trading and price action trading. Trend trading means you are waiting for an established strong trend and then entering trades on pullbacks during that trend. Reversal trading means you are trying to catch reversals as they happen and preferably waiting for confirmation of reversal before entering the market in hopes of a reversal. Price action trading means entering the market based on how price is reacting according to other recent price action areas and then anticipating the next move. These are all very different trading styles and they should be traded in completely separate manners, with different indicators. Do not use trend indicators and then expect them to catch reversals. Do not use reversal indicators and expect them to point out trends. Do not use price action indicators and expect them to give amazing signals in every type of market. Choose what type of trading you are going to do and stick to that, do not mix and match and expect amazing results on every different type of trade. Be smart, be patient, be disciplined and stop trying to trade every move the market makes.
7. Limit your risk and increase your win probability by trading with the trend using our external indicator filter features. These features will prevent buy and sell signals from coming in until the market is in a confirmed trend according to the external indicator of your choice. Some great indicators to use for filtering the trend are the Trend Trading Indicator, Trend Strength, Scalper Ribbon, Any 8 Moving Averages, Multi-Timeframe VWAP and the Higher Timeframe Price Action Scanner. Use these to your advantage and let the external indicators help you wait for a trend before trading by using these features. In the future, we will add new filters you can use for volatility and other useful types of filters so stay tuned for those updates to make it even easier to know when to trade.
8. Use the charts from the exchange with the most volume and CLEAN price action for the best signals. The algos need a lot of data to give signals so always watch the exchange with the highest volume and cleanest candles. For stocks, use ARCA, NASDAQ & NYSE exchanges for best results. For crypto, use Coinbase charts for best results. Do not use Binance charts as their charts have a lot of big wicks and will not give reliable signals compared to other exchanges. For forex FXCM, Blackbull and Pepperstone exchanges work very well. If you are unsure if the exchange you are looking at is good for the algo or not, just look at the historical data and compare signals across other major exchanges and pick which one works the best for that particular ticker.
9. Trade tickers that have a lot of price action and show very reliable signals historically. For stocks some of the best signals I have seen are on APPL, SPY, AMZN, QQQ, SQQQ, TQQQ, TSLA, NVDA and AMD. For crypto, some of the best performing tickers I have seen are ETH, BTC, LINK, MATIC, SOL, LTC and XRP. Any ticker with very little price action, lots of big wicks and gaps between candles won’t perform well with our indicators due to various reasons. The algos were built to perform well on the most popular tickers so try to use it on the tickers mentioned above the majority of the time.
10. Most of our indicators are made for scalping as I am a scalper but I have added swing and long swing modes to give you extra options. For the earliest entries, use scalp mode and switch to swing mode if you want it to hold positions longer but early entries are not as important. If you want even larger moves, just use higher timeframe charts while keeping the algo on scalp mode. You can also try swing mode or long swing mode and see if those suit your style better. Many 1 minute timeframe users like swing and long swing mode, but higher timeframe users typically use scalp mode or swing mode. Make sure to try them all and adjust your settings to find the perfect fit for your trading style.
11. NEVER LET A WINNER TURN INTO A LOSER!!!!! I have seen too many people get all of their gains wiped out because they thought it was going to the moon and let a big winner turn into a big loser. Do not let this happen! Set a stop loss and move it up as your profit increases so this doesn’t happen to you. Again, don’t be greedy. Make good decisions on a consistent basis and you will see your win rate improve. When a large up or down candle forms in the direction of your trade, wait until that candle closes and then move your stop loss to be just under that candle’s low for long positions or just above the candle’s high for short positions. Then continue to trail your stop loss this way until you get stopped out. This helps maximize your wins, while locking in profit along the way in case the market turns on you.
12. Trade with the trend. 90% of the bad signals come from small moves against the trend. If the market is moving upward, look for longs and if the market is moving downward, look for shorts. I like to wait for signals with the trend that are at logical bounce zones and grab those positions that line up with trend continuation. This will keep you from getting yourself into bad situations a lot of the time. Use our external indicator filters with a trend indicator as the source to help you trade with the trend better.
13. Try to wait for good volatility if you want the best signals. Chop is a portfolio killer and an emotional stressor. Wait for the market to act in a predictable manner before entering trades as this is when you will get the best signals and have the easiest trading conditions.
14. Risk management is a huge part of trading. Letting losses run and cutting winners quickly will wipe out all of your gains fast, so make sure to let the winners run and cut losses quickly. Losses happen in trading, but to keep it from hurting you too much you have to cut those quick and keep your emotions and feelings out of it. The market does what it wants and doesn’t care what your position or bias is, so never marry a trade. Smart traders turn into profitable traders.
Happy Trading 🙂