Don’t forget the 5min Charts

Hi Everybody,

I have said this before, but please don’t forget the 5min Charts, as there are some great setups on these, for example the lovely TS3 buy on the 5min YM on Friday (there was also a TS4 buy on the 5min ES at the same time).

As you can see, the YM then rallied off this low to reach the first projected profit target for a nice +3R Profit (ignoring slippage and commission). We used the WPT target as the STF was weak.

So the lesson here, is even if you mainly follow the 3min Charts, don’t forget the 5min ones as 5min chart very often give you some nice tradable setups :-)

Thanks

Steve

A great +6R Profit on the Russell

Hi Everybody,

Isn’t the Cyclical Nature of Trading amazing ! Here we are, after a few hard days, then we get a beautiful TS3 sell on the 3min Russell Index. The reason I liked this one over the YM was because the ABC pattern was a lot more symmetrical.

As you can see, the Russell declined sharply from the TS3 sell (which nailed the very bar of the high !) Once the STF strength band was exceeded we swap to the ATRStop, which held the short trade until it was stopped out for a very nice +6.3R Profit (ignoring slippage and commission).

This particular trade was why I designed MTPredictor in the first place, to look for the ABC correction “inside” a larger degree wave (2) (look at the 5min for this), off which a strong Wave (3) swing unfolds. This is the best trade in the book !!

Steve

Beware the creeping DP

But, and this is a good example, what of the two DP sells later in the day. Yes these turned out OK overall with a -1R loss followed by a +3.3R Profit (ignoring slippage and commission). However when DP’s are clearly “against” the larger degree trend they have a habit of “creeping”, in other words you can get multiple DP’s that fail. That is why the DP should only be used when you have confirmation of the larger degree trend particularly that you are at larger degree support or resistance. The reason for this is that the DP’s are “trend termination” setups and not “trend continuation” setups, so care is needed with them.

Steve

A standard TS2 buy

Hi Everybody,

To start with, a nice and standard TS2 buy on the 3min NQ. As you can see, this made a nice +2.4R Profit at the WPT target (ignoring slippage and commission).

The larger degree trend was up on the 15min chart, so this was a nice standard trade............

But what of the DP sells later in the day ?

Steve

A difficult day part 3

There were some nice trades on the long side in other markets, like the YM and NQ, particularly later in the day, which would have been OK, as the 15min trend had turned up again by then.

But I agree, yesterday was a tricky day.

As we all know, this is down to the Cyclical Nature of Trading, where the good times are followed by harder times when a few losses occur as well as quiet times, before the good times come round again. This is just how trading unfolds in the real world.

Thanks, Steve

A difficult day part 2

So the question is whether the TS3 sell on the 3min ES chart was “in the direct of” the 15min Trend ?

If you look at the chart to the right you can see how the 15min ES had hit DP resistance and was starting to decline. So yes, the 15min trend “at that time” had turned down, so looking for sells on the 3min chart was correct.

What most amateurs do not understand is that sometimes, no matter what our analysis says, the markets does what it wants, that is why we have stops in the market. In this case the stops did their job by keeping the loss small at just -1R

Thanks, Steve

A difficult day

Hi Everybody,

Unlike most Gurus and vendors in the business, I do talk about losses and the hard days, and yesterday was a hard day on the US e-minis. They do happen, all professional traders will tell you this, it is just that most vendors conveniently forget about these hard days!

Anyway, the trade I wanted to look at was the losing TS3 on the 3min ES in the morning yesterday.

Yes this was a -1R loss, but that loss was kept small at just -1R, but the question was whether this was a valid trade. For this, let’s take a look at the 15min Chart

Thanks, Steve