Monday, August 29, 2011
Listen to Your " ITS TIME TO QUITE INSTINCTS"
Listen to your "Its Time To Quite Instincts"
If you cannot hear this after 3-4 trades then the ODDS are Great that you will OverTrade on the day and possibly blow up your account.
So listen to that voice in your head that says, "thats it. Done for the Day!" Win Lose or draw. Listening to how you feel and acting on it early is professional behavior.
THINKING IN TERMS of LOW RISK ENTRY!!
THINKING IN TERMS of LOW RISK ENTRY
Today i put on trade that brought something to the forefront of mind as i entered the position. Nothing new but It needs to be reinforced. When entering my best trade of the day i was thinking. "Wow this is a LOW RISK OPPORTUNITY, GO!!!" At this point I was fully aware of the point at which I No longer liked my odds, (ie. Bar breaks, BB Breaks, recent 1500/500 S/R Cycle breaks, probars that may show up in the wrong place etc.)
Just Placing mental or physical markers can help with EXIT STOPS TREMENDOUSLY and keeps your Risk Reward Ration above 2:1. Using this for stops while keeping natural targets and observing Holding time in the trade can be really effective Trade management techniques that are subtle but effective.
No this is not a holy grail but all it takes is the ability to cut losers short and fast and allowing the winners to max out in order to show consistent profits.
Saturday, August 27, 2011
Text Book REVERSALS and TRENDS that Follow
TEXT BOOK REVERSAL SETUP
1st we had a 6.25 Gap Dn = Reversal Day Type signal.
2nd we had multiple Exhaustion signals on the 4500 and 1500 ticks as well as the 5 minute.
3rd we had Probars appearing on the 1500 at cycle support.
4th we saw the 4500 Mid line BREAK & CLOSE.
5th We saw the Retest of the mid line that had probars on the 1500 and 500 tick, once that 500 probars breaks this is confirmation of early pullback in Up trend.
ON Strong TREND's Notice how the Price will trade within the Upper or Lower BB When Trending, using the Midline as S/R in continuation. These are notes Not trade entry's. The Reversals and Trend Confirmations are great guides and will often sync with other tick charts clearly showing pullbacks and re-entry's on the 1500 and 500 ticks.
Monday, August 15, 2011
Friday, August 5, 2011
Trading Abnormal Markets With Ultra Volitilty and HUGE ranges
Over the past few weeks we have seen volatility pick up casually and Then suddenly we are Hit with a huge 71 pt Range as prices sell off on the ES. The Dow Sells off 512 pt giving up 4.31% in one day. This is referred to as a Black Swan Event by Larry Conners.
How to react to events such as the one we are currently experiencing is the question at hand. Below is a list of ideas that i saw as solutions to preserving capital and and actually putting on profitable trades.
#1 Avoid Trading at all, Waiting it out Is Never a Bad Idea and is probably the very best thing traders can do to avoid unnecessary risk and exposure. If you feel you must trade us the demo account.
#2 DO NOT GET CAUGHT UP IN THE HYPE - Thinking Wow look at all these opportunities, i could just scalp the action. THIS mentality is sure to have you on the losing end of most trades and will decrease your odds causing you to over trade for sure.
#3 START THE DAY LATER- meaning avoid the open an look for midday opportunities when the range settles a bit.
How to react to events such as the one we are currently experiencing is the question at hand. Below is a list of ideas that i saw as solutions to preserving capital and and actually putting on profitable trades.
#1 Avoid Trading at all, Waiting it out Is Never a Bad Idea and is probably the very best thing traders can do to avoid unnecessary risk and exposure. If you feel you must trade us the demo account.
#2 DO NOT GET CAUGHT UP IN THE HYPE - Thinking Wow look at all these opportunities, i could just scalp the action. THIS mentality is sure to have you on the losing end of most trades and will decrease your odds causing you to over trade for sure.
#3 START THE DAY LATER- meaning avoid the open an look for midday opportunities when the range settles a bit.
Tuesday, July 19, 2011
Market Bias Tool for Pre-Prep Routine
The Market Bias tool was developed by myself as an easy yet fast way to analysis the days activity based on the volume indicators used in my trading.
I simply plug in the specifics of the daily activity, primarily the Higher Time Frames.
This spits out a number that i have set a gauge table to in order to determine the likely outcome.
The tool has been very very helpful and accurate to about 70% over the past few months and helps me to remain disciplined in general direction of Trend Strength and Weakness. While the accuracy may vary depending on the close, it is very good predictor of early directional bias prior to the 7 bar zones. Many times the outcome will play out in the aftermarket causing the need for further conformation or even a neglect of the original bias.
The Market Bias tool when combined with the Day Type information and Daily Volume Profile provides a great insight into potential direction for the upcoming trading day.
Market Bias Tool at a glance
I simply plug in the specifics of the daily activity, primarily the Higher Time Frames.
This spits out a number that i have set a gauge table to in order to determine the likely outcome.
The tool has been very very helpful and accurate to about 70% over the past few months and helps me to remain disciplined in general direction of Trend Strength and Weakness. While the accuracy may vary depending on the close, it is very good predictor of early directional bias prior to the 7 bar zones. Many times the outcome will play out in the aftermarket causing the need for further conformation or even a neglect of the original bias.
The Market Bias tool when combined with the Day Type information and Daily Volume Profile provides a great insight into potential direction for the upcoming trading day.
Market Bias Tool at a glance
Wednesday, July 13, 2011
How Trade the News for Max Profit
Trading the News can be daunting for a new trader and is usually NOT recommended due to whipsaw potential and the seeming uncertainly in the market.
However When taking into account the Fact that THE NEWS DOES NOT DETERMINE MARKET DIRECTION, IT ONLY CONFIRMS THE MOST CURRENT DAY'S TREND.
We should be looking for EARLY signs of Strength/Weakness.
This includes Prior day Strength/Weakness on 15 minute close, Globex Strength/Weakness, Market Bias and the Opening Day Type.
Once we have a picture for WHERE the Trend is likely to go we must then focus on Timing. The tool for timing is the actual News Release TIME for potential ENTRY's and the 7 bar zones for potential EXITS.
Prior to the Rally (if one occurs) Professionals will usually spike price against the current trend to catch stops, Enter at wholesale prices and spook the public prior to rallying. This is catch as many people wrong footed as possible so as to make the process of marking the price up easier.
Below is an example of this process and its outcome with a FOMC statement release at 7:00am pacific time.
The steps to look for are as follows
# 1 Prior Days Strength/Weakness - in this example we had Signs of Strength on the Close with a fairly wide spread down bar on high Volume.
15 minute close
# 2 Globex Strength/Weakness - Here we saw that Price bounced after the close, a result and confirmation of strength on the close, BUT NEVER retested those lows of 1310 area.
However Price traded into the 1314-1315 zone on the Pre-Open with Stopping Volume and and Profit Taking bars.
13500 Tick chart
# 3 MARKET BIAS - The market Bais for the day was
Daily Market Bias For Tomorrow = +0.857 Moderate/STRONG Bull.
This takes into account the prior days Strength/Weakness, Exhuastion Divergence and Daily Details and clues and summerizes the information into a general bias, When this is confirmed by the Day Type we have a Very high Probabilty directional bias that is good till the 7 bar in most cases but may resume beyond that time.
# 4 DAY TYPE - The day type interprets the likely outcome of the morning based on the width of the Gap Spread. (for further details see links below)
Often the Day Type will match the Bias and provide powerfull insights. When this occurs the focus on timing the entry becomes the final straw.
In this example the day type was 5.75 Gap Up Signaling an Early Reversal into Trend/Gap Test. We play this by Entering on the 1st extreme of the 15 minute bar, or High Time Frame CYCLE. Here we see the Low was on the 15 minute Daily pivot, Down bar with Block Volume = Strength
This also coincided with the 13500 retest of pre-open Low forming a double bottom
Also the 4500 BB low on High Volume
(Notice the Gap of 5.75pts and the Early Reversal off the lows then PEAKS at or around the 7 bar zone)
These 4 Clues gave us a VERY HIGH probability trade by forecasting the potential future price action of the day.
Understanding that the News release TIME was scheduled for 7:00 we are well positioned to Ride the spike into the 7bar Peaks with entry's Near the Lows of 1314-1315 area.
EXIT's are typically at or around the 7 bar peaks.
In Summery
When Trading the News ie. FOMC Statements etc. Stick with the Current Trend, Look for Strength /Weakness in the background, If the News is at 7:00 USE the GLOBEX Strength/Weakness as the directional base. THE MARKET MAY start to drift against the trend and even spike to catch stops and scare the Public out BEFORE the move in Trend.
However When taking into account the Fact that THE NEWS DOES NOT DETERMINE MARKET DIRECTION, IT ONLY CONFIRMS THE MOST CURRENT DAY'S TREND.
We should be looking for EARLY signs of Strength/Weakness.
This includes Prior day Strength/Weakness on 15 minute close, Globex Strength/Weakness, Market Bias and the Opening Day Type.
Once we have a picture for WHERE the Trend is likely to go we must then focus on Timing. The tool for timing is the actual News Release TIME for potential ENTRY's and the 7 bar zones for potential EXITS.
Prior to the Rally (if one occurs) Professionals will usually spike price against the current trend to catch stops, Enter at wholesale prices and spook the public prior to rallying. This is catch as many people wrong footed as possible so as to make the process of marking the price up easier.
Below is an example of this process and its outcome with a FOMC statement release at 7:00am pacific time.
The steps to look for are as follows
# 1 Prior Days Strength/Weakness - in this example we had Signs of Strength on the Close with a fairly wide spread down bar on high Volume.
15 minute close
4500 Tick Close
# 2 Globex Strength/Weakness - Here we saw that Price bounced after the close, a result and confirmation of strength on the close, BUT NEVER retested those lows of 1310 area.
However Price traded into the 1314-1315 zone on the Pre-Open with Stopping Volume and and Profit Taking bars.
13500 Tick chart
# 3 MARKET BIAS - The market Bais for the day was
Daily Market Bias For Tomorrow = +0.857 Moderate/STRONG Bull.
# 4 DAY TYPE - The day type interprets the likely outcome of the morning based on the width of the Gap Spread. (for further details see links below)
AfterMarket GAPS and the 15 minute Chart
Recognizing Types of Trading Days and how to React
Often the Day Type will match the Bias and provide powerfull insights. When this occurs the focus on timing the entry becomes the final straw.
In this example the day type was 5.75 Gap Up Signaling an Early Reversal into Trend/Gap Test. We play this by Entering on the 1st extreme of the 15 minute bar, or High Time Frame CYCLE. Here we see the Low was on the 15 minute Daily pivot, Down bar with Block Volume = Strength
This also coincided with the 13500 retest of pre-open Low forming a double bottom
(Notice the Gap of 5.75pts and the Early Reversal off the lows then PEAKS at or around the 7 bar zone)
These 4 Clues gave us a VERY HIGH probability trade by forecasting the potential future price action of the day.
Understanding that the News release TIME was scheduled for 7:00 we are well positioned to Ride the spike into the 7bar Peaks with entry's Near the Lows of 1314-1315 area.
EXIT's are typically at or around the 7 bar peaks.
In Summery
When Trading the News ie. FOMC Statements etc. Stick with the Current Trend, Look for Strength /Weakness in the background, If the News is at 7:00 USE the GLOBEX Strength/Weakness as the directional base. THE MARKET MAY start to drift against the trend and even spike to catch stops and scare the Public out BEFORE the move in Trend.
However be patient and hold on, the spike prior to the 7:00 news may be the perfect entry.
(Notice the Strength in the Globex session(never retesting the lows) and Spike at 1314.25 level scaring the public and
Subscribe to:
Posts (Atom)