Are Proprietary Indicators Necessary to Succeed in E-Mini Trading?

A large number of trading operations require prospective members to buy a set of indicators that the educators claim are “absolutely necessary” to trade successfully. These indicators often run thousands of dollars and bear a remarkable resemblance to any one of a number of well-known indicators that can be had on the internet for little or no cost. In my opinion, there are few, if any, e-mini trading indicators are worth the price many of these educators are asking.

Let’s be blunt here. The trading education business has morphed from a performance-based business in recent years to a software-pushed business. Why? Well, the simple answer is money and accountability. An indicator doesn’t have to show a profit and loss statement at the end of the day and at the astronomical price at which most are currently being priced the performance really becomes secondary. New traders get a false sense of security knowing they are using a special indicator that has proven itself profitable and charge headlong into the fray with their new piece of technologically progressive software. Nothing could be more misleading than this assumption; trading technique makes good traders, not indicators.

Of course, any experienced trader can tell you that there is very little new in the indicator world of value. There is no magic in proprietary indicators; instead, most are a rehash or combination of long-standing indicators well known to experienced traders. With the exception of recently introduced order flow software, the old J. Wells Wilder style of trading lagging indicators is the norm.

Geez, you are being awfully hard on indicators. There must be some value in these programs.

I haven’t been involved in swing trading since my institutional trading days so there may be some value if you are a swing trader; however, if you are an e-mini scalper there is no value in the magic indicator of the hour. You can find a plethora of similar indicators on the listed indicators that are part and parcel of any reputable trading platform.

For anyone who has read my past articles, you would know that I eschew all but real-time indicators of which there are only a handful. E-mini scalpers require real-time information, not lagging information to make accurate trading decisions.

There may be some conceal indicator around that is going to change the trading world, but I have in addition to come across it. Most proprietary indicators bear a remarkable resemblance to the MACD, Stochastics, CCI and any of the other popular free indicators. My advice is to look at any proprietary indicator and determine if it will be of any value in your trading, then make a decision to use thousands if you really see the value. For me, there is no value. Of course, you may feel different and that is a choice you will have to determine.

Finally, if a trading program requires you to buy their indicators in order to be part of their program you should probably look at other programs and see if you can’t find value in a program that teaches trading technique, not indicator trading. As always, best of luck in your trading.

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