3min Chart of the Russell Index

The 3min Russell Index also got in on the act a bit later with a good looking TS4 buy setup. The Russell rallied nicely off this to reach the first project profit target where a nice +2.9R Profit (ignoring slippage and commission) was available.

Do you all see now how the larger degree trend was up (on the 15min Charts) so you should have avoided the sells and only taken the buy. The result was approx +5R Profit over the YM and TF buys. Compare this +5R Profit to the potential -0.4R loss the day before and now do you all see how MTPredictor does such a great job of keeping your losses small and Profits large. This is the key to long term success in this industry

Thanks, Steve

3min Chart of the YM

Exactly, as the 15min trend was up you should have avoided any sell set-ups and focused on the buys..........

And we got a nice TS2 buy later in the day that made +3.2R Profit (ignoring slippage and commission), please see the chart to the right.....

Steve

Trend again........

Hi Everybody

I hope you were all paying close attention to my comments in yesterday’s Blog posts, because yesterday was a perfect example of how to use the larger degree trend. So let’s take a closer look at the 15min YM chart as an example.............

Here we can see that the 15min YM put in a Wave 5 low, with the low right at the typical Wave 5 WPT. The YM then started to rally off this low. This set the larger degree trend to up for the rest of day as the 5min YM rallied up into DP resistance.

OK, with the 15min YM trend UP, what did that mean for the shorter-term 3 and 5min trades ?

Steve

Always think in “R” units

OK, in my last post we saw how there could have been -3R on the 3min YM, as I said, the ES was only -1R. BUT, and I have to say this again, these were not good buys to take as the 15min trend on the e-minis yesterday was more down than up, so sells should have been the order of the day (not buys).

So now let’s look at the 3min NQ, where a nice +2.6R Profit (ignoring slippage and commission) was found.

This is the important part, even on a bad day -3R plus +2.6R equals only -0.4R (ignoring slippage and commission) down. Compare this to the +8.7R Profit from Friday and can you all see why it is so important t keep the losses small. There will always be losses and bad day and yes, even losing days, but the trick is to keep these small when compared to the Profits., This is what makes a successful professional trader..........

Steve

Be cautious about DP’s

The DP set-up is a very good setup for nailing the “end” of a trend, but by definition because it is a “trend termination” setup, you need to have added confirmation that a higher degree turn is coming in. That is why I always say be very cautious about DP’s on day like yesterday when the larger degree trend was down on 3 of the 4 US e-minis.

However, let’s look at what the “worst case” would have been on the 3min YM (the ES was a lot better than this with only one -1R loss yesterday). As you can see, there would have been three -1R losses BUT, as I said in my last post, on days like this, when the trend looks to be more down than up, caution is advised on taking long trades, so the more experienced traders among you would not have taken these sell setups.

Steve

Trend, trend, trend.............

After a good week last week it looks like we are back in the harder part of the cycle, particularly for the definition of the larger degree trend. A good “rule of thumb” is that if the picture is unclear then be very cautious or even don’t trade. There are too many amateurs who “over trade” and think they have to trade lots each and every day, this is simply untrue. As I outlined in the Trading Course, there will be times when the picture is unclear. When this happens the best cause of action is to have the patience and discipline to wait until the picture become clear again before committing your valuable trading capital.

Yesterday the 15min trend looked down on all the US e-minis, apart from the 15min YM earlier in the day which looked to be making support at the DP. As such you should have been mainly looking for short trades.

Steve

Back now............

Hi Everybody,

I am back now after a wonderful and very enjoyable vacation.............

After looking through the charts, it was nice to see that there have been some nice trades while I was away, for example this massive +8.7R Profit (ignoring slippage and commission) on the 3min YM from last Friday...........

Thanks

Steve

A few days vacation

Wow, after a few such brilliant days on the markets with MTPredictor I am having a few days holiday. As such there will be no posts until the end of next week.....

Thanks

Steve

Now for the Advanced Traders

I was asked how you could have taken advantage of the strong rally later in the day. Well, as you can see the 3min ES did make a ABC correction (as found by the Elliott Wave module). This got you long into the 5-wave rally that then unfolded.

Tightening stops as the minimum Wave 5 WPT was reached would have taken profits at the high of the day ! for a very nice +7.7R Profit (ignoring slippage and commission). This long was backed by the larger degree (15min) up trend.............

What a day, a day in which MTP nailed the very low (DP buy), then the very high (minimum Wave 5 WPT) of the day for you – this shows the power of MTPredictor :-)

Steve

DP Buy nails low of the day !

OK, now we know the 15min Chart was at DP support, we could have been comfortable about the DP buy on the 3min Chart, this nailed the low of the day for you !!

The result, a nice +2.4R Profit at the first target (ignoring slippage and commission)

Steve

First the larger degree trend,

Hi Everybody,

As usual we start with the larger degree trend. As you can see the 15min DP nailed the low of the day on the ES beautifully yesterday. This set the larger degree trend to up for the rest of the day.

OK, onto the 3min Chart now

Steve

Massive +11R Profit as the market collapses

Then, later in the day we had a TS4 sell, and YES this was “in the direction of” the new 15min down trend, so should have been taken.

As the ES reached the first target the STF strength band was exceeded so you should have swapped to the ATRStop. Also “knowing” that you were in the direction of the new 15min down trend would have given you added confidence in looking to run this short trade further....

This held the short trade as the ES started to collapse. The ES fell sharply right into the close where a massive +11R Profit (ignoring slippage and commission) was available.

Now do you all see how quickly the markets can put you back into Profit. We had a horrible day on Tuesday with 5 straight -1R losses, and yes, overall it was a losing day. But with only -2.3R loss, do you see how this was still very very small to the massive +11R Profit that market came back with for us the very next day ! This is why I take so much time to teach you how markets really unfold, so you are not disappointed after a hard day, so you do trade the next day when the big profits come though again. This is why MTPredictor is so brilliant, because it keeps the losses small when then come through, but then maximises the profits on the good days for you !

Steve

DP sell nails the high of the day !

First, we had a DP sell on the 3min ES. As we have already seen, this was at 15min DP resistance, so was OK to consider. This actually nailed the very high of the day for you !!

The reason it was market with a triangle was because of the two bars having the same highs. I suggest you review the History Signals video for more info ion this. But the result was a sell from the very bar of the high for a nice +2.4R Profit (ignoring slippage and commission). A nice start to the day.......

Then we had a potential TS4 buy. But the larger degree trend was now down, so this buy was best avoided.

Steve

Amazing !!

Hi Everybody,

Isn’t the Cyclical Nature of Trading absolutely amazing ! After a very hard day on the 3min YM on Tuesday, the markets then come back with an absolutely amazing day on the 3min ES, with some massive profits............ So please read all of the next 3 posts to see MTPredictor in full swing :-)

First, let’s start with the larger degree trend.

As you can see, the ES made a high right at DP resistance, this then set the down trend for the rest of the day............

OK, onto the first 3min Chart....

Steve

Now for the Advanced Traders

OK, so far I have outlined a very hard day on the 3min YM with 5 straight -1R losses. But these are all sells, so was there anything that the Advanced Traders among you that may have helped avoid these losses.

First, knowing that we had had a few very good days before and that we are overdue for some losses (Cyclical Nature of Trading) should have made you cautious going into yesterday. Then looking at the 5min Chart and seeing that the low of the day was right at the Typical Wave C WPT should have also made you worry about taking short trades later in the day.

Agreed, I normally do not look at the 5min charts for the larger degree trend I normally use the 15min, But combine this good looking Wave C low (on the 5min) with the fact that we are overdue for some losses, would have made the Advanced Trader be very cautious and probably avoid any 3min sells as the YM rallied off the 5min Wave C low.

Yes, this is Advanced, and comes with experience, but this why I do not believe in totally automated trading as a PC would never be able to view markets as well and as a good and experienced trader.

Steve

Now the 3min Russell

But the 3min Russell did help soften the day with a nice +2.7R Profit (ignoring slippage and commission) late in the day.

So add +2.7R to -5R (again this is worst case on the YM, the other e-minis were far better than this) and you get -2.3R down overall. Yes this was a loss, but then compare -2.3R to the +4.7R and +5R profits from just the day before........... This is why I keep on saying that successful trading is all about Risk control and keeping the losses small. Here, even with 5 straight -1R losses (which is hard), all these are cleared by just one +5R profitable trade from the day before.........

Amateurs do not understand this, that is why I teach “the good, the bad and the ugly” here on a daily basis to help you all become professional traders that understand that losses can unfold, even a string of 5 -1R losses, but they are still small in comparison to the huge profits on other days. And this is what makes money overall............... To become a successful professional trader you must learn to understand this and accept it.

Steve

A hard day

Hi Everybody,

As I keep on saying, I am one of the few Gurus and vendors that talk about the hard times, and as such I will choose the “worst” example to show today. Again, there are very few vendors that even ever mention losses, let alone show worst case examples. But you all need to know how the “real world” unfolds sometimes.

As you can see, the 3min YM had a hard day. With the 15min trend down the DP buy early in the day was break even, but then followed 5 -1R losses, which was a very hard day. Days like this do happen, but they are rare.

BUT, we did get a ray of hope later in the day on the 3min Russell, next post.

Steve

PS, but this should have been expected. You all know about the Cyclical Nature of Trading, so what is likely to happen after a run of very good and very profitable days. So a hard day yesterday should have come as no surprise.

TS4 sell on the 3min TF (Russell Index)

OK, now we have established that the new larger degree trend was down, this TS4 sell on the 3min TF (Russell Index) was a perfect one to look to take, and then even let run.

As you can see, letting this one run (as it was “with” the larger degree down trend) into the close gave a potential +5R Profit (ignoring slippage and commission), making a good end to a very good day yesterday

Thanks, Steve

What of the larger degree trend ?

As you all know, you should always be aware of the larger degree trend, and this is a good example of why I follow all 4 of the US e-minis (ES, YM, NQ and TF). Here the 15min ES made DP resistance about midday, so what do you think the new larger degree trend was now ?

Exactly, down, so looking for shorts was needed.

Yes I did highlight a -1R loss on a TS3 buy on the chart of the 3min NQ in the post below, but do you see how this was now “against” this 15min DP resistance even though this was on the NQ and the 15min resistance was on the ES.

Thanks, Steve

DP Nails low of day on the NQ !!

Hi Everybody,

For the 4th day running MTPredictor has nailed the exact high or low of the day on one of the 4 US e-minis. I think that is pretty fantastic !

Here we can see a automatic DP buy on the 3min NQ. The NQ then rallied strongly. Using the ATRStop would have held the trade for a nice +4.7R Profit (ignoring slippage and commission).

I know a number of you caught this very trade as you emailed me on it yesterday, so very well done.......

Thanks, Steve

100% Initial Risk level

I was asked a good question on this 3min DAX DP trade, and that was “when to use the 100% initial guideline” to bring the stop to break-even. As you can see, this long DP trade did exceed the 100% initial risk level, but traded back to break-even before then rallying to reach the first projected profit target. (Yes we did then swap to the ATRStop where a +2.3R profit as made).

So why should you not have used the “100% initial risk guideline” in this example ?

Well, it is all about the “larger degree” trend. As I have said many time before, we only use this guideline when we are unsure about the larger degree trend. In this example the DAX was rallying off a Wave 5 low, so the larger degree trend was clearly up. Hence we could take longs with confidence so there was no need to look to protect profits quicker, so the 100% initial risk guidelines should not have been used.....

Thanks and I hope this helps ?

Steve

Manual DP sell

Later in the Day there was a brilliant “manual” DP sell on the 3min YM.

As you can see, this nailed the high of the day absolutely perfectly.............. The YM then declined into DP support, just before the close, for a very nice +3.6R Profit (ignoring slippage and commission).

Yes this was a “manual” DP level so is for the more Advanced users among you. But do you all see how this profit, at +3.6R is much bigger than the -1R loss from the NQ example below. Small losses and Big Profits, this is the key to long term trading success.........

Thanks

Steve

Yes losses do happen

Hi Everybody,

Unlike most vendors and Gurus in this business, I do talk about losses.............. And here is an example from Friday on the 3min NQ. It is important to understand that losses can and do unfold, but the trick to a successful approach is to keep the losses small (not avoiding them). This loss at just -1R is small to the last few days where we have had a number of +3R Profits on the US e-minis.

Small losses and Big profits, this is the key to a successful approach to trading........

Thanks

Steve

Another perfect example of Patience Part 2

Here is the ES 15min Chart.

As you can see, the 3min TS4 buy came at a 15min TS2 buy. Then the 15min ES was moving up to a Wave 5 high. That was why you should have looked to hold your 3min TS4 longs and not look to swap to shorts as 3min sells came in, because the 15min trend was clearly up at that time.......

Thanks

Steve

Another perfect example of Patience

Hi Everybody,

Amazing how yesterday gave us another perfect example of an almost identical trade from the day before. As you can see, after a -1R loss, then we had a TS4 buy, that nailed the low of the day (we have now done this for 2 days running !). The ES then crept higher until the DP target was reached, where the STF was strong, so we swapped to the ATRStop for a very nice +3.8R Profit (ignoring slippage and commission).

So again, and absolutely perfect example of where patience to let the trade unfold and mature was needed.

The only question camas as some sells unfolded along the way..... But these were “against” the 15min Up trend (next post) so should have been ignored...

So again, the lesson is patience............

Steve

Patience is required

Hi Everybody,

Yesterday was a perfect example of why every professional trader needs patience.

As you can see, the 3min ES gave a nice TS3 buy yesterday, which as the low of the day. The ES then crept higher all day, to eventually reach the first projected profit target. At this point the bars low were not breached, so this long trade remained intact. The STF then broke the strength band so the trade was held until close, which was near the high of the day for a nice +4R Profit (ignoring slippage and commission).

But the point here is that there was just one trade, long form the low of the day, into the close, which was near the high of the day for a good profit. I wonder how many of you did not hold this all the way and as such did not maximise your profits on this trade. Patience is a fundamental requirement for all successful traders....

Steve

3min YM

But what I did like yesterday was how, at the same time as the ES was banking its profit, the 3min YM gave us a good looking TS4 sell. This caught the decline into the close for a nice +3R Profit (ignoring slippage and commission). Makin yesterday a good day overall on the US e-minis

Thanks, Steve

PS, there was also a lovely manual long on the Russell early in the day but as this required totally manual analysis it is beyond the scope of this Blog.

3min ES

Hi Everybody,

After a quiet start, the 3min ES did give us a few tardes, the first was a -1R loss (yes losses can and do happen, but the trick is keeping them small), which was followed by a nice +2.3R Profit (ignoring slippage and commission). Notice how the STF was weak, so the WPT targets were used.

Thanks, Steve

+5.8R on the 3min FTSE

Hi Everybody,

For those of you who read my post on the FOREX Blog on the TS1 setup this morning, well, here is another great example that unfolded on the 3min FTSE from just this morning..........

As you can see, the FTSE rallied up to the Typical Wave 3 WPT nicely where a Profit of +5.8R was available (ignoring slippage and commissions)

Thanks, Steve

PS, there was an opportunity to get short a little while later as a Wave 5 high came in to ride the sharp fall that is currently unfolding, but I will let you all look at that and how it “fitted in” with the larger degree trend perfectly..............

This stuff is absolutely amazing sometimes

For the Advanced Traders....

Hi Everybody,

When there are few setups, the more Advanced among you can also look for “ABC” patterns that unfold by themselves. A good example was on the 3min YM yesterday, where an ABC correction unfolded after the initial decline from the high. This could have been used to enter a new short trade...........

The YM then declined sharply. A simple trade management strategy could have been the ATRStop that would have resulted in a nice +6R Profit (ignoring slippage and commission).

But because this was found using the Elliott Waves module it should be considered an Advanced technique.

Thanks, Steve

A hard day

Hi Everybody,

Unlike most Gurus and software vendors, I do go out of my way to show losses and hard times ! But then, you should all know about the Cyclical nature of Trading by now, so what comes after a run of good and profitable trades ? Exactly some harder times, and that is what we got on Friday. And to keep this Blog even fairer I want to look at the 3min YM which had the hardest day on Friday. Again, there are very few software vendors that will go out of their way to show the hardest and least portable examples. But then we are different at MTPredictor, and want to show you how the “real-world” unfolds. There is too much snake oil and rubbish in this industry, I wish more Gurus were more honest with how the real world really unfolds !

As a professional trader you have to understand and accept that all days will not be easy. Your job is to keep your trading capital in tact during these harder time so you are ready to make the most of the good times, like we had earlier in the week.

Anyway, as you can see there were a few sells as the market continued higher, so no wonder these did not work out. BUT, the 15min trend was up at this time, so you should have been focusing on Long’s and not Short trades, thereby avoiding these potential losses.

Steve

3min NQ

Hi Everybody,

The 3min NQ was the best of the 4 e-minis yesterday with 3 lovely profitable trades.

The first, a TS2 was “in the direction of” the larger degree up trend. As was the TS4 buy later in the day. The only one that was hard was the DP sell. As you all know, you need to be cautious about DP trades, as they are “trend termination” setups and are a bit like standing in front of a train sometimes. That is why they should only be used when they are either at larger degree support/resistance or after 5 clear swings. This DP sell was at a Wave 5 high, although not perfect, that is why if you had taken it, you should have protected it quickly.

The last TS4 buy only got to the DP from the prior Wave b high, but that is a technique I have shown many times over the last week :-)

Thanks

Steve

Nails the high and low of the day !

Hi Everybody,

What an amazing trade on the 3min YM yesterday. I just have to share this with you all, as the TS4 sell nailed the very bar of the high.................. Then the profit target nailed the very bar of the low of the day for you ! I still find it amazing how well these levels work sometimes.

Yes there was a -1R loss later in the day, but the +5R Profit (ignoring slippage and commission) more than made up for this...

I agree, it was slightly nervous, with another sell appearing on the way down, but the YM did make the first profit target off the first TS4 sell.

Thanks

Steve

Now for the Advanced Traders

As usual, the more Advanced Traders among you could have squeezed some more profit out of that YM short – how ?

Well, as you can see, the YM declined into an area where it was at two WPT support zones, one from the original TS3 sell, and one from the swings since then. Also, the YM made a high volume expansion bar into this double support zone. This is normally an indication off a “blow off” and that a move is nearing an end.

Will all this happening “and” you are sitting on +10R Profit (ignoring slippage and commission), what do you think the sensible course of action is – exactly, look to tighten your stop to lock in this huge profit.....

Thanks, Steve

Cyclical Nature if Trading

Hi Everybody

Isn’t the Cyclical Nature if Trading amazing ! Just as I said yesterday, were we were “overdue” for a good trade, and then look what came along on the 3min YM yesterday. A perfect TS3 sell setup that made +7R Profit (ignoring slippage and commission) and all using the standard trade management guidelines of swapping to the ATRStop after the STF strength band was exceeded...........

Now do you all see why Patience and Discipline is needed to get you though the harder times so you are ready to make the most of brilliant trades like this !

Thanks, Steve

Another small profit later in the day

For the Advanced Traders among you, there was a nice high volume (VSA) sell later in the day. But as we have already seen, because the markets were only making small swings yesterday, the profit was small, but it was a profit

Thanks

Steve

First minor target (again)

Hi Everybody,

Yesterday I looked at using the DP form the prior Wave b swing as a “first minor” target when the markets are only making small swings. Well, another example unfolded on the 3min NQ again yesterday.

As you can see, the decline from the TS3 sell early in the day did decline, buy only slightly, but, just look where the low came in, right at the DP from the prior Wave b low. Just as I outlined in my Blog entry yesterday......

BTW, it is no surprise that we are only getting small profits at the moment and this is because we are just in that part of the cycle and the markets are only making small swings at the moment. You should all know about the Cyclical Nature of Trading by now, as I mention it regularly. As you all know, this will change as we move back onto the big profits part of the cycle soon.

Thanks

Steve

First minor target

Hi Everybody,

Just a quick reminder, (for those of you who have not read the Trading Course for a while), that you can use the DP (decision Point) form the minor Wave b low, if you suspect that the current swing, off a Wave C high / low, may not continue into the first target.

There was a good example of this off the TS3 sell on the in the morning on the 3min NQ on Friday....

Thanks

Steve

3min FTSE

It was a lot easier on other markets yesterday though, for example on the FTSE, which gave us this beautiful +6R Profit (ignoring slippage and commission) on the 3min Chart.

Sometimes the trading is a lot easier than other days. That is why you must not get emotionally involved and tart each day (the good the bad and the ugly) in exactly the same way. This is just the Natural Cyclical Nature of Trading at work, some days are hard and some days are a lot easier....

Thanks, Steve

Patience and Discipline

Hi Everybody.........

Today’s lesson is all about Patience and Discipline. These are qualities you must learn to have if you wish to become a successful professional trader. The 3min ES yesterday was a perfect example of this.

As you can see the 3min ES had 3 straight losing trades yesterday, so most amateur traders would have given up. BUT look at what happened on the forth trade of the day, a brilliant +6R winner (ignoring slippage and commission). So +6R less 3R (three -1R losses) meant even with 3 losses and 1 winner you were up +3R overall. Understanding this is what makes the difference between a successful professional trader and a losing amateur.

BTW, when you are sitting on a good profit and you only have a short time before the market closes, it is always sensible to look to lock in that profit, that is why I suggested trailing the stop just above the bar highs. If you had held to the close it would still have been a +5R winner though.

Thanks, Steve

2min ES – Advanced Analysis

If you can see the “minor” 5-waves in the Wave [1] initial decline off the high, here is the 2min chart, where the minor patterns are a lot clearer............

I am not going to say much about this, because I get told off by the standard level traders. But needless to say, this is what MTPredictor is capable of if you wish to take the time and make the effort to “learn” how to trade well. I do find it very sad that so few traders are willing to make this effort, But I guess that is why only a small % of traders will ever be really successful and make the big bucks. The sad reality is that the vast majority of traders are just too lazy or can’t be bother to work hard at anything......

Thanks

Steve

3min ES – Advanced Analysis

OK, onto the bit I like, the Advanced Analysis, as this shows just how good MTPredictor is, once you know what to do and have taken the time to learn and study.

Yesterday I outlined a “perfect” 5-wave Elliott pattern that was followed by an ABC before a sharp decline. Well, guess what, the 3min ES did exactly the same yesterday. Please see the chart to the right. This enabled the Advanced Traders among you to catch this sharp fall later in the day.

Thanks

Steve

3min NQ

OK, now onto to some losses and harder decisions. (As I know how much you all like talking about loses :-) )

Yes, there was a TS3 sell on the 3min NQ as the markets rallied off the lows, and yes that was a valid trade and yes was a valid -1R loss. As we all know losses are OK as long as they are kept small. But the trades I wish to focus on are the buy later in the day..

As you can see, the rally on the NQ reached DP resistance, so bearing that in mind you should have been cautious about any buys later in the day, as the new trend was now down. So, even if you took these you should have been cautious and got your stop to break-even very quickly.

Thanks

Steve

15min ES

Hi Everybody,

First I would like to start with a look at the Elliott Wave module on the 15min ES chart.............. What amazed me was how the low of the day yesterday stopped right at our WPT support. As I said yesterday, sometimes how well this works just amazes me !

Thanks

Steve