Overview

 

This is the premier product for day traders and aspiring day traders. Now you can join the revolution and build systems that give buy and sell signals on 1, 2, 5, 10, 15, 20, 30, and 60 minute bars, as opposed to the daily bars that are in the Trader and Trader Pro. You can watch each tick change the high, low, and close of the last bar on the chart, until the bar is finished and becomes part of your trading system. Use your alerts to wake you up from your nap, if you are one of the few who will be able to sleep while the DayTrader is running!

 

You are going to need a special real time data feed to use the DayTrader. There are many such feeds available, and we may eventually support more of them, but this first version of the DayTrader only supports one. We could have held up the DayTrader until more data feeds were supported, making more of you happy, but that would take a great deal more time. We elected to release the product with only one feed supported, even though it may not be YOUR feed. If you are willing to use the one we now support, the DayTrader is for you. If you want to join the revolution later when we can support something you like better, you can do that too.

 

 

Popular Issues are Now More Amenable to Modeling Technology

 

One interesting thing about the DayTrader is that it opens a whole new world in terms of what stocks or other issues are predictable. For the first time, you can use neural nets on rapidly rising stocks like Yahoo, AOL, and Dell, because they fluctuate greatly during the day, even though they mostly go up on a daily basis (at least they did prior to the new year!).

 

 

Avoiding Overnight Price Jumps

 

Another interesting thing is that now you can avoid the gaps between today’s close and tomorrow’s open, gaps that often aren’t explained by technical indicators. Get in and out of an issue as many times as you wish during the day, and close the position at the end of the day.

 

This “gap avoidance” is done in two ways. First, when you insert an indicator, you can check a box that instructs that the indicator NOT be computed across day boundaries. Neural nets will not train on bars where the input indicators are missing.

 

Second, you can add trading strategy conditions based on time of day. For example, you can enter a trade if both of the following conditions are true:

 

Your Indicator > 50 

Time < 3:30 PM

 

Then you might want to exit if either of the following is true:

 

Your Indicator < -50 

Time > 3:45 PM

 

 

Simple Models and Less Data

 

In our experience, the more complicated models that are needed for end of day position trading are not necessary for intraday trading. Simple models often work well.

 

Furthermore, since you are dealing with shorter bars, you won’t have to go back years in time to build neural nets and backtest strategies. That way you aren’t using training sets on market conditions that are now ancient history. If you download 2 days of 1 minute bars, you have the rough equivalent of 3 years of daily bars. Training sets of just the last few days are not only feasible but also advisable in our opinion.

 

On the other hand, some will disagree with us (after all, that’s what the Trader is all about: building models the way YOU want them instead of how someone else tells you models should be built!). Some will feel that longer periods may be better for training to pick up trends. If you use 90 trading days of 30 minute bars, you will have about 1170 bars, roughly equivalent to around 4.5 years of daily bars! So still, you do not have to go back to the Stone Age for data.

 

Optimal Performance

 

The bottom line will be this: for optimal performance, limit charts to only a few stocks with a couple weeks of intraday data if you are using small bars. Excessive time frames of small bars will likely result in lengthy data loading and slower program performance.

 

Interface

 

The interface for the DayTrader has pretty much the same interface as the NeuroShell Trader Professional. The first difference you may notice is that instead of just daily, weekly, and monthly bars, you can chose smaller intraday bars down to 1 minute bars. (Note: even though we only go as low as 1 minute bars, you can still see the ticks as they change the current bar being built.)

 

The next difference you will see is that the charts are no longer just daily. Since the bars occur all day, the charts can be zoomed in to intervals less than one day.

 

The third difference is that other intervals such as training periods, evaluation periods, backtest periods, etc., can also be chosen in smaller time intervals.

 

The fourth, and perhaps final MAJOR interface difference, is that we have combined the Data Download menu and the Data Directories menu into a new menu called “Data Sources”. It is here that you will also find a “Server” tab that enables you to specify the real time server. Also, you can select those exchanges from which you may want to download. This interface is going to be the same interface for the regular Trader and Trader Professional in release 3.0 – minus the

Servers tab.