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