Hello, traders! Today, we’ll dive into using the Sonic Trading System from Day Trade to Win. This system provides the key elements you need for day trading success: entries, targets, and stops. However, managing trades based on the system’s rules is just as important.
Let’s break down some critical lessons from today’s session and explore how you can improve your trading game.
Missed trades are a part of day trading, especially when the market moves fast. In today’s example, I attempted to enter at 5788 quarter, but I wasn’t filled before the market hit my target. In this situation, holding on or chasing the trade isn’t a good idea.
If you miss your entry and the target is hit, cancel the order and move on. The market offers numerous opportunities, especially when using a system like Sonic. Don’t let one missed trade derail your focus.
After successfully entering at 5790, I adjusted my target and stop as per the system’s rules. Sonic makes it easy by providing clear targets and stops on the chart. However, it’s essential to manage these parameters yourself. If your target or stop is hit, avoid taking the same trade again.
Many traders fall into the trap of trying to re-enter after missing out, which can lead to unnecessary losses. Stick to the system and wait for the next signal.
When I entered the trade at 5790, my target was 5791—just a few ticks away. But in fast-moving markets like the mini S&P, NASDAQ, or Dow, even small targets can take time to hit. While it’s tempting to hold on, the goal is to avoid staying in a trade for too long, especially during the first few hours of the session. Patience is crucial, but knowing when to cut your losses or take a small profit is equally important.
The Average True Range (ATR) is a critical tool in the Sonic system. It helps define your target and stop levels based on market volatility. In today’s trades, I aimed for a target that was less than one times the ATR. This approach allows you to take quick profits without holding onto trades for extended periods, which can be risky.
If you prefer bigger profit targets, you can set your target to two times the ATR and trail your stop, but the safest approach is often to go for quicker exits based on the market’s immediate movement.
A common question in our live trading room is whether you should take the same trade again if you missed it the first time. My advice? No. Once a trade hits its target or stop, that opportunity is done. Re-entering increases your risk and can lead to poor decisions.
Additionally, if you didn’t adjust your target correctly and missed your profit, it’s better to close the trade at break-even or a small profit/loss. The goal is always to protect your account, not to chase the market.
If you’re new to day trading or looking to enhance your skills, sign up for a free member account at Day Trade to Win. You’ll get access to our live trading room, the ABC Method, and software for NinjaTrader or TradingView. It’s an excellent way to start learning how to trade using price action, without relying on outdated indicators.
Day trading requires not only a solid strategy but also disciplined trade management. The Sonic Trading System gives you a clear framework, but it’s up to you to follow the rules—adjusting stops, managing targets, and knowing when to walk away from a trade. Stick to these principles, and you’ll set yourself up for consistent success.
Happy trading, and don’t forget to sign up for your free member account to learn more!
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