The 3Dimensional Trading Breakthrough

Brian Schad
Host: Let’s take these same markets and create different types of orders. Instead
of market orders let’s make these markets have certain criteria to meet before
our orders are filled.
Brian: Yes, this is the way I prefer to place my orders. I like the market to meet
specific requirements before I “buy long,” “sell short,” or offset any position!
Having the market meet specific criteria is a way I keep emotionalism out of my
trading and at bay! Let’s continue with basic stop orders:
Stop orders: Stop orders are placed above the current market price if buying, and
below the current market price if selling. The criteria which must be met is the
market must simply trade AT a certain price, and then my order to buy (or sell)
becomes a market order.
Example #1 - Stop order (initiating a futures position): I want to go long 3
December Wheat futures contracts when, and if, the price reaches 296^4
(Price is now at 294^0):
“This is a day order for account #12345, buy long three Dec Wheat at 296½ cent
stop.”
Example #2 - Stop order (initiating a futures position): I want to go short
one June Live Cattle futures contract when, and if, the price drops to 64.55
(Price is now at 65.30):
“This is a day order for account #12345, sell short 1 June Live Cattle at 64.55
stop.”
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