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Description of Price Action Trading

Extract from the Preface:

'1. What the book covers

This book is about day trading. Using the price action itself, rather than any of the usual array of indicators based on it. The US 30-year Treasury Bond Futures is the favoured instrument - the T-Bonds, as they are commonly called. There are good reasons for choosing this instrument to learn to trade - one being that they do not require a detailed knowledge of bonds themselves. The other attractions, whether you are a beginner or a seasoned veteran, are to do with liquidity, range, behaviour, patterns and the price action displayed at the key support and resistance points it encounters.

Most days the T-bonds offer trading opportunities which can be taken within a money management environment that can give you an edge for profit - and this book has been designed to show you how to do just that. Fully illustrated with charts taken from a live trading screen and displayed in exactly the way you would have seen them for yourself, on your computer monitor. What you see is not just what happened, in detail, but also clear evidence of just how you could have profited yourself from each trading situation.

2. Who the book is for

This book has been written for anyone wishing to day trade, using a discretionary method, rather than a mechanical system. It is a learning tool which should commend itself to the experienced trader, as much as to someone new to this business. Certainly I hope that any raw recruit would find it an easy read, even if it took a while longer to digest the subject matter as a whole.

3. How the book is structured

The seasoned trader will probably start by skip reading, to see if he can cut to the chase quickly. The less experienced will immediately see - from the detail of the charts alone - that there is a great deal of information to absorb, and will have to start at the beginning! After that, wherever you place yourself as a trader, I hope you will find that the methodology is pretty straightforward, the approach you need to adopt clear-cut, and the various steps involved in the process uncomplicated.

It has to be said that there is nothing amazing or wonderful in learning to read the tape - for that, albeit in a computer environment, is what this methodology is all about - and the key to success in so doing, is in the application of a robust risk/reward/ratio. This means that the successful exponent of the art-cum-science of discretionary trading, in this particular way, has to have a mindset that can take the winning and the losing with complete equanimity. It is not easy. It is not for everyone. But . . . those who can learn how the market works and learn to go with the flow, putting the odds on their side, stand a good chance of creating the essential edge to win.

Those who already day trade in discretionary fashion will hopefully gain pointers here and there and find, as we all know, that it often takes just one pearl gained to make the trawl an eminently worthwhile exercise. Those who come to this book with little or no experience will gain from their lack of preconception, even if it takes a lot of reading and re-reading to get up to speed on the computer, with live charts.

Best of luck
Bill Eykyn'

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Title Information

ISBN:

9781897597347

Pages:

164 pages

Format:

Paperback

Product Code:

16680

Publisher:

Harriman House

Published:

01/09/2003

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About Bill Eykyn

From his very first interview as a cub reporter (with Richard Dimbleby in the actual biplane used by Bleriot half a century previously), Bill Eykyn has been a journalist, writer and broadcaster. So he came to the market with a very different perspective from the norm.

He started, like so many, with a newspaper ad. This one led him to trade FTSE options on BBC2 through a broker with hot tips. After the obvious happened, he was introduced to the FTSE Futures, using a special TV aerial for the data feed. Then options on the American grain markets (via satellite and a clunking DOS program), including a hair-raising run on the Soyabeans.

Finally - and none too soon - he was introduced to the T-Bonds in Chicago by a CBOT and CME Member, where he gained a wealth of experience, in and around the pits. For several years the trading was through a satellite feed from DBC in America, but then the company metamorphosed into E-Signal and its internet feed - and these are the charts used throughout the book.

"Trading should be viewed", says Bill, "as a game played by the Big Boys, with savvy traders following in their footsteps - and this is where my concept of price action trading comes in."

This book is actually a sort of swan-song, because Bill Eykyn is retiring to a farmhouse in Andalucia, where presently there are no telephone lines. However, as soon as he can get a satellite communications system up and running, his three novels currently on the go will be put on the back burner - yet again!

Contents of Price Action Trading

About the author
Preface
Introduction

1. Establishing a home-based trading business
Home office - data delivery - computers & peripherals - charting packages

2. Choosing your markets
Markets - range - volatility - slippage - bid/ask - t-bonds

3. Setting the scene
Charts - looking left - yesterday's high & low - pivots - pit pivot system

4. Before the market opens
Overnight - events calendar - Alan Greenspan and reports - the Big Boys

5. The Fibonacci legacy
Fibonacci of Pisa - .382, .500, .618 retracements

6. Pattern recognition and price action
Price patterns - reversals - breakouts

7. Formations, First Fridays and other phenomena
Trends - formations - relationships

8. Risk/Reward and targets
Calculation - entry - stops - targets - exits

9. Low-risk learning
Using spread betting to price action trade

10. Doing it all off PAT!
Price action trading - the compleat trader

Appendices

I. Press release from US Treasury concerning the suspension of 30-year bond issuance

II. Glossary of abbreviations and terms

III. Recommended reading

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