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low risk trade idea

  • Writer: Korbinian Koller
    Korbinian Koller
  • Aug 22, 2023
  • 3 min read

What is the most low risk trade idea for a newbie to get into the market?


Well my first response would be that we define the term risk


from a market selection perspective it would be the futures market since its rules and regulations are most conducive to a self directed trader compared to other markets


from a trading instrument perspective, US index futures, they are very liquid and reliable from many aspects of their personalities


from a market time perspective, the third part of the US session (the close):



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the picture above shows a 15 min time interval chart in NY eastern time


the open is defined as a 90 min time period starting at 9:30AM eastern time


followed by the doldrums, a less liquid time where market makers typically go to lunch


and finally the close, the last 90 minute before the market closes at 16:00 hours eastern time


why we picked the US session and its last trading segment as to be the most low risk time to be trading since it provides a stable market with a high liquidity that also provides for the trader the maximum dataset for making low risk plays intraday being proceeded by data from two sessions prior(open and doldrums)


risk from an individual play perspective would be a play that has been preceded by a daily call that has its probability set for a possible trend day and being confirmed to be right by the first two sessions(open and doldrums) pointing towards a very high likelihood for a successful trend day in the making



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the chart above shows the most common trend day formations


the trend day formation on the bottom is the typical trend day shape with advancing prices right out of the gate for close to 90 minutes and than prices flatlining through the doldrums to advance some more in the closing session


the chart in the middle is very much the same besides price tapering off during the doldrums which often can provide for a substantial leg up in the closing session


in the top chart we see that doldrums extend in time and when traders are about to fall asleep a massive second leg can erupt surprising the average trader


the next chart shows less often occurring chart formations in the category of trend days:



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these would be the trend day formations where the trader trying to catch the second leg in the closing session might occur losses


now as you already know no extreme approach like the above is a low risk one since trade frequency amongst many others might not be supportive to the specific individual traders psychology and mental makeup, but I have been in my earlier stages of my trading career followed this setup and as matter of fact it was my very first system that was successful since one has quite a few odds stacked in ones favor.


Most significantly the one to trade in the markets direction and the saying is true"the trend is my friend", which cuts losing streaks of trying to fade a trend and acquiring losing streaks


and secondly the limited required focus time of 90 minutes per day(one enters and exits positions only in the closing session)


When I traded this system I didn't have sophisticated entry and exit methods available yet, that you are already familiar with


another edge that makes this simple approach to the market more attractive and reduces risk yet for another notch


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