Best Trading Indicators for Day Trading and Swing Trading: This video (and article) on the best trading indicators will teach you how to use a rather old-fashioned strategy in trading which still works in today’s market. This strategy will surely give an edge in trading against many others.
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Best Trading Indicators for Day Trading and Swing Trading
Barry Burns here with Top Dog Trading on the Best Trading Indicators for Day Trading and Swing Trading. Today, we’re talking about one of the best trading indicators strategy on any platform, any software. It’s actually a drawing tool and it’s an old one, definitely nothing new, but sometimes the old stuff is good and I tell you what, I don’t find a lot of people still using this. Sometimes, people are always looking for an edge with new stuff and that’s cool. But you know what, sometimes you can find an edge by bringing back something old that people aren’t using anymore. That’s definitely the case here. I use this all the time and I absolutely love it. So it’s the good old-fashioned Andrew’s pitchfork, and I am going to show you a couple of ways of tactically how to use this. First of all, you want to see that you have a change of direction.
So we have had a move up. Now, we’re looking for a move down and I find that this is especially good for an exit. We’ll focus on exits today rather than entries and that’s one of the big problems that I see people having. They write to me and they say, Barry, I don’t know where to get out of the market, where do I exit? And I will tell you that I agree – entries, I have no problem with entries. But exits are much more challenging than entries. In fact, even as I’ve talked to other traders and so forth who have been trading for decades, interviewed them and they have told me rather consistently saying, even though I’ve made all this money in trading, I’ll tell you, the one thing that I felt I never mastered is when to get out of the market.
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And I don’t honestly think that anyone knows the perfect time to get out. But what we’re looking for is a good time to get out when we can have a high probability exit where we’ve made some good money and say this is a good time to get out. Not that we’re going to ever catch the entire move of every single impulse where every single trend, that would be unrealistic so certainly not expecting that. But what we do want is a good risk-reward ratio and we want a reasonable, logical and high probability time to exit. First of all, let me show you how to draw this. You’ll see that I just did it right there. It’s a three-point drawing tool. We’re going to take a high, remember looking for a reversal here, so go to a high to a low to another high.
So that’s the basic thing is that against the three-point drawing tool. You start there and then to there and then a lower high. So looking for that shift in a trend. Okay? Now you’ll see that it draws tines, these are called tines because well that’s just the term for the little things that come off of a fork. And this is called Andrew’s pitchfork. That’s what they call this. So we’ve got our middle Tine here. This is just the central line, you want to consider it that. Then we’ve got this main section here, I’m actually going to do it both ways, just so it can kind of see that. And you’ll see that I have these two colored very differently. So the middle one I make black and then the two outside of that I make thicker and darker blue.
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And then the ones outside of that, a little lighter blue and the wind outside of that a lot lighter blue. And that’s just for visual identification. You know what I should do too is actually show you my settings here because I know I’ll get questions on that, which I don’t blame you. I would expect that. So here are my settings for it and now you’re setting may be a little different; different charting platforms, they seem to use little different things for the parameters and so forth. But anyway, here you could see the handle. All right? So the handle is that part where the fork, you would actually pick up the fork so to say. Alright. And then we’ve got tine one tine two. And so there, you’ll see those are the darker blue lines that I’ve got and I made them with the four.
That’s just for customization, but the percentages, the colors, the width, all that, that’s just however you want to do it based on your personal preference. But what is important here are the percentages. So, tine one is 100 percent, tine to zero percent. Now, I have found that different charting platforms will prescribe different percentages there, but this is for Ninja trader seven. So these are going to be equidistant from the handle from the middle line. And then from there, I use 50 percent differences. So we’ve got our 100 percent and then we’ve got our 150, we had zero percent, then we got minus 50, and then after 150, we’ve got 200 and after a negative 50 percent, negative 100. So those are the settings that I use here. Now, let’s talk about the tactics on how to trade this for exits.
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So the primary thing that I’m watching; so the tines that are the most important in order to stay within a, let’s say a strong and downtrend, is these two here. That’ll be your 0 and 100. Now, what we’re going to look at here is basically we’re looking at an energy of this first move, from down to up and then back down and we’re saying alright, so this first lower-high and the low between it established a pattern, almost a geometric pattern if you will. And as long as price action stays between these two times or these two lines, we are continuing that same type of energy. So one of the things that we will look at is, for example, when it gets down to here, it’s still within that zone. When it gets out of here, now we’re breaking outside of that same energy.
In other words, the market is not going down with as much enthusiasm as it started. So it’s starting that that downward energy, that trend down is starting to dissipate, if you will. Now, it doesn’t mean it’s gonna go up right away. Sometimes it does, but this is a little more typical of what happens. So it comes back down, hits that tine, comes back up, comes back down, hits that time, it comes back up, kind of rides this one down. And let’s see what happens from here. Now, when it breaks out of the final one, the final line or tine, then I consider, this downtrend completely done this pitch fork over. Not going to look at that pitchfork anymore. I could just take it off of the chart if I wanted to. That would be one place to exit.
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Another place to exit is a little more aggressive. You get a little more reward on it is when you wait for it to break out outside of this major tine here. And then look for it to come back and see how low it can go. It may not come all the way down here. You could look for things like a double bottom, etc. But just look for it to come back down here and then take a profit down here. So those are two options for you. There’s never one thing that’s always the best, unfortunately, but this is your primary signal right there. The signal that the energy has changed no longer is dramatic to the downside. Now, having done that, let’s just move our chart forward a little bit and let me show you how we can then measure this thing to the upside.
So now that we’ve broken out, we’re okay. Let’s say we went long. Now we bring up our Andrew’s pitchfork again and now we’ve got that low, that high, and this low here. Alright, so now that we’ve got that, we’ve got the same kind of thing going on again and I’ll actually, now that you see why we drew that. So we drew it. Why? Because we look for it after we put in another high and then another low after we’ve broken out of that tine there, right? The two major ones. Okay. Now, let’s see, so it’s not so cluttered. Let’s actually go back and take this one off. Just create more clarity for you. So what we are, here’s another way to exit. And again, there are different techniques because the market doesn’t always do the same thing every time.
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So it comes in here, holds that one, gets a little below it, comes back up to the middle and holds this one. By the way, notice that it also kind of provides diagonal support resistance. Now, here is the point of the second type of exit. Once it gets above the upper major tine, I call these my two primary tines. So this is then a very aggressive move to the upside for it to break above; see, last time we were looking forward to break below the tine to get out. Now, we’re saying, it’s going in the direction of the trend and it broke out above the major wind at the top. So I consider that to be often an exhaustion move. It’s almost like when you see a reversal candlestick pattern that coincides with a high volume bar and you say that’s an exhaustion pattern.
Well, this will be the same type of concept where statistically it’s getting above the norm and when I see this I say that might be a good place to get out. We’ll go and break both the high of that. I don’t know, it’s possible, but statistically, that is a very bullish move. Therefore, I considered it an exhaustion move and whatever the market does in the future, that’s probably going to at least regress or retrace down quite a while and I don’t want to sit through that. I mean we’ve made some good money here. Let’s say you got in whether you got in there or let’s see, you get in here where even if you got in here, you know you made some good money.
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You got a great P & L there because this is one way you could do it. As far as entries go, you could say let’s set up our Andrew’s pitchfork and then wait for it to hold the lower level and by there, that would be one thing to do. So my risk is very small, it’s basically that little rectangle there and my reward is that. It actually did make a higher high after that. But look what it also did in the meantime, which is very cool. So this is where, I would get out on an exhaustion move. It comes back down, goes to this tine, goes to that tine, goes to that one and goes to that one, see how it’s providing diagonal support & resistance almost makes it to that line.
Comes down here, right? So that went up. Comes down here. Almost uncanny. Did it make a little higher high after where I got out? Yup, so what? I don’t want to hang in there through this retrace and if it goes up higher, great. Again, we’re not going to catch every single penny and every single move, it’s just impossible. That is a good high probability exit and that’s what I’m looking for. High probability exits, that’s not looking to be right, looking to make some money. And then, well, what happens then when it finally does break down below this final tine, look at that, sure enough, that trend reverses and it goes down. So that is one of my favorite trading indicators, strategies, drawing tools, etc. Test it out for yourself, see how you like it.
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Now, if you liked this video on the best trading indicators for day trading and swing trading, if you found it interesting, please understand that it’s not free. Wait a minute, it’s not free, I just watched it. Yeah, it is free. But from a spiritual point of view, if you got value from it, then you have an obligation to pay it forward. Share it with other people. That’s what we’re supposed to do as good people, right? And that’s really the very best thing you can do is to click the share button below. If you’re watching this on youtube, feel free to subscribe and click the thumbs up icon. And one of the best things you can do also is leave a comment. I love your comments, even if you disagree with me or maybe have something to add to the conversation to help other traders who are watching this. That’s all great. We invite all.
I have a very special offer to you. I’m giving away one of my favorite trade strategies called the rubber band trade. It is a super high win-loss ratio. In fact, I still take this trade every single time I see it, that’s how good it is. And it’s pretty simple. I’ll teach you two and 26 short minutes. So get my rubber band trade strategy absolutely free by simply clicking on the image in the top right corner of this video or in the description above or below this video. If you’re not watching it on youtube, there’s probably a link below or above or an opt-in form on the side. Once you do one of those things, I’ll personally email the video to you with the rubber band trade strategy.
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BTW, if you’re interested in the indicator that I use personally for very precise entries and exits. I’m happy to share that with you. Just send me an email at firstname.lastname@example.org, and I’ll show you how to get access to that indicator.
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