Daily S&P update

Hi Everybody,

It was no wonder that the S&P (on the daily Chart) had a fall yesterday, because if you look at the chart on the right you can see how it had reached the level of two prior highs. This would have been a natural resistance area using standard technical analysis, so it should have been no surprise that we had a decline from this level yesterday

Thanks

Steve

3min Dax - Advanced trade management

Hi Everybody,

However, just because one market is going through a hard patch does not mean that they all are. Of you look at the chart on the right you can see how the 3min DAX gave us another beautiful trade this morning.

The TS3 buy nailed the low of the day. The markets then rallied into a DP sell setup where a +7.5R Profit was available.

For those of you are more advanced, you will have noted (no chart) that the larger degree 15-min picture was unclear as we got into this DP sell. In some of my posits below I suggested not “stopping and reversing” form a good trade into a weaker trade that was against the 15min chart. But what happens if you are sitting on a good profit (+7.5R) and the larger degree trend is unclear ? Well, common sense should kick in. In this example that meant protecting the larger +7.5R Profit and then avoiding the new DP sell.

As you can see, there is a lot of common sense in trading that can only be gained by experience, and that is what it means to be a good advanced trader.....

Thanks

Steve

As a PS, the 5min Chart had also made a nice 5-wave rally which was another raeson to anticipate a top and therefore look to portect the proift on the currnet long trade as the high came in

What to do on the Hard days

Hi Everybody,

If you ever read on the Internet that trading is easy and it is easy to make loads of money every day, then you know you are dealing with somebody that has no practical experience of trading themselves............. The fact of trading life is that there will be hard days, this is why I talked about the cyclical nature of trading only a few days ago, because all professional traders know that there will be hard days (or hard weeks or hard months) when making money will be virtually impossible. Please click here for my prior post on this.

As you can see form the chart to the right, yesterday was one of these days. With such small and choppy swings, it would have been almost impossible to make money yesterday.

So what should you do on days like this. Well, you should have been anticipating a hard day as we had such a brilliant week last week on the US e-minis, so your aim yesterday should have been to avoid all but the best looking setups (of which there were none) or be very very careful. In other words, during the hard part of the cycle your aim should be to just tread water and preserve your capital so you are then ready for when the profits come though again.

This is just a natural cycle of profits and losses that unfolds day after day, but few people talk about it because so few Gurus or software vendors are actually traders themselves.

Thanks

Steve