OK, but what of the nice TS4 sell on the 3min Russell

OK, so far I have suggested that the YM was better than the Russell at around 10:40EST on Friday. But what if you prefer to trade the automatic setups and are uncomfortable with manual analysis ?

Well, this is why we always suggest that you follow all 4 minis (ES, NQ, YM and TF), because (as we have seen) the YM (and the NQ) was making a possible high, so if this was correct then all 4 minis were likely to follow each other down. So with this in mind you could have considered the TS4 sell that unfolded on the 3min TF at the same time.

Yes, this was not ideal, because the 15min TF was not clear, but do you all see how because you were anticipating a decline on the market as a whole it was OK. Please note, if you are at all uncomfortable about this kind of “correlated markets” analysis, then don’t take the trades, This is more of an “educational piece” for the more Advanced Traders among you to show you what you can do with more experience. All I would say, is that if you are unsure about a trade, then bring the protective stop to break-even faster to protect the trade.

Thanks, Steve

3min YM manual DP sell...

OK, now we have decided that the YM was in a clearer and more obvious position on the 15min Chart, lets move down to the 3min chart and see what we get.

Well, at 10:42EST the 3min YM was also at DP resistance and as such the Advanced Traders among you had a potential manual DP sell setup. As you can see, this was the high of the day off which the YM declined nicely.

Once the STF strength band was exceeded (after reaching the opposing DP) the ATRStop was used, this resulted in a nice +6.5R Profit (ignoring slippage and commission) .....

Thanks, Steve

The larger degree trend Part 2

In the 15min Russell Index chart (post below) the picture was very unclear, but now compare this to the 15min YM (chart to the right) and I hope you can all see how the picture was a lot clearer, with the 15min YM reversing off DP resistance mid morning.

So what would common sense tell you to do if you have a clear picture on the YM but not on the Russell ?

Exactly, pass on the Russell and focus on the YM for shorter term trades.... so let’s take a look at the 3min YM in the next post

Thanks, Steve

The larger degree trend

Hi Everybody,

Today I have some good examples that will help with many questions I get on a regular basis, and that is what to do when the larger degree trend is unclear ? As such I do suggest you read all of today’s entries to follow the examples though.

A good example was on Friday, so let’s start by looking at the 15min Russell Index chart ?

As you can see, the picture is not clear at all with no obvious DP support or resistance zones off which the markets is reacting.

Now compare this with the 15min YM chart in the next post (above)

Thanks, Steve