Strategies for Mechanical Traders
Summary
This chapter discusses the three strategies for mechanical trader. As a mechanical trader, one's main focus in trading the markets is not time driven but system driven. The trades are based on a fixed routine, regardless of time frame and regardless of market activity. This style of trading is especially suited to newbies because strategy execution is based purely on a set of fixed steps or rules. Due to its non-dependence on specific time frames, the three strategies discussed here employ time frames that span three different categories: scalping, day trading, and position trading. The first strategy, the guppy burst, is based on the 5-minute (M5) chart. The second strategy, English breakfast tea, is based on the 15-minute (M15) chart. The third strategy, good morning Asia, is based on the daily (D1) chart. Many newbies love the fixed routine by which mechanical trades are set up. It is also the reason why many go on to develop automated trading systems by coding the trading rules into software.