One for the European Traders...

Hi Everybody,

A nice TS4 buy (using IQFeed data) this morning on the 3min FTSE. Notice how the DP target nailed the high perfectly. Standard Traders among you would have swapped to the ATRStop as the STF strength band was exceeded. This gave a nice +3.3R Profit (ignoring slippage and commission).

Notice how the loss earlier was kept small. -1R is a lot less than the +3.3R made on the Profit, small losses and large Profits, that is the key to successful trading.......

Thanks, Steve

3min YM

OK, let’s now look at the 3min Chart.

The first trade of the day was not filled because the YM rallied and exceeded the high “before” taking out the buy order, so no trade. Then there was a legitimate buy that resulted in a -1R loss. Yes losses can and do happen, but as we all know by now, the trick is keeping them small, which is what we did here.

Then the question comes as a DP sell arrived later in the day. Yes this was in line with the 15min DP so was a valid one to take. But the difficulty came as a TS4 buy appeared a little later. Should you ignore, or stop and reverse or what ?

This was a difficult decision, because, yes, the 15min was at DP resistance, but that was only minor. So the best course of action would have been for the standard traders among you to just protect the profit as the TS4 buy came in. But the more advanced traders among you could have stopped and reversed for another +2R on the way back up again.

But before you all email in, this was not an easy call as the DP high was only minor resistance on the 15min chart.....And that is all that unfolded – a minor decline from that high.

Thanks, Steve

15min YM

Hi Everybody,

OK, as usual, let’s set the “larger degree trend” using the 15min Chart, today on the YM.

As you can see, we had a TS3 buy early in the day, so this set the larger degree trend to up. But the question comes later in the day when the YM reaches the DP (from the minor wave b high). As I teach in the Trading Course, a “minor” high can be made there, but it is usually only a minor high. So this does raise a question on the 3min chart that we will see in the next post....

Thanks, Steve

3min DP sell nails high of day !

Hi Everybody,

Yesterday was an interesting day, with the markets working their way high for most of the day, until a DP sell arrive on the 3min YM at 14:45 EST. As you all know, I am always cautious about DP setup, as they must be in tune with the larger degree trend, i.e. at “larger degree” support or resistance. As you have see from the last post, the 15min YM was right at the Typical Wave 3 WPT, so a decline was likely, as such this 3min DP sell was a good one to consider.

As you can see, this nailed the very high of the day for you !!

The YM then declined nicely. As the STF strength band was exceeded the ATRStop was used for trade management (standard trade management guidelines). The result was a nice +3.8R Profit (ignoring slippage and commission).

A nice start to the week :-)

Steve

Larger degree trend on 15min YM

Hi Everybody,

As always, let’s start with the larger degree trend. Nothing much was happening on the 15min Charts, until the 15min YM reached the Typical Wave 3 WPT. Normally I don’t like taking tares off the Wave 3 WPT as these are “counter trend”, but on the “shorter term charts, a move was likely from this level. As such we can now move down to the 3min Chart to see if any setups were unfolding at this time.....

I have also include some other support / resistance zones on this 15min Chart, and as you can see, these have done a brilliant job, nailing the last few highs and lows absolutely perfectly. I still find it amazing how well this stuff works sometimes !

Thanks

Steve

Larger Degree Trend – Video

Hi Everybody,

I know a lot of you can find the transition from “standard trader”, (where you follow the STF colour and just look at the automatic setups), to becoming a more “advanced trader”, (that looks at the larger degree chart, using the DP levels, as well as moving onto more advanced manual analysis), a little tricky. As with learning any new skill, this transition takes time.

My advice is to keep following my Blog, re-reading the Trading Course, watching the videos and most of all, practice and study your charts.

It took me many years to become a expert trader, so to expect this in just a few days or weeks is silly. MTPredictor is a very powerful piece of software. We have the automatic setups, and this is where most of you start. But then, as you learn more, you begin to use more modules and routines in the software. The Russell Index trade (shown below) is a great example of how the more experienced trader can use the other modules in the software to improve their results. So learning to become a better and more experience trader is more of a “journey” rather than a once stop solution.

This Blog will help in that journey, so today I have put together a help video on the larger degree trend for you:

http://www.mtpredictor.com/help/videos/LargerDegreeTrend/LargerDegreeTrend.html

This will help show you how I use the larger degree charts to determine the larger degree trend

Thanks, Steve

For the Advanced Traders

OK, now onto the Advanced traders. If you are a Standard Traders, and cannot follow this, then please do not worry, it will come with experience.

Although this trade was taken on the 5min Chart, can you see how we did reach the DP support zone. So at this point in this time with +8R Profit (which is a good Profit), were there any signs that this decline may be nearing an end.

Yes, on the 3min Chart, there was stochastic divergence “and” the last decline was in a Wave 5. Both of there were suggesting a low was coming in. So combining this with the DP support, “and” you were nearing the end of the day “and” you were on such a massive +8R Profit. The common sense thing to do would be to look to lock in this +8R profit.

As you can see, this nailed the low nicely.

Thanks, Steve

PS, Yes, there were lost more Advanced trades, especially on the Russell in Friday, that I do not have time to go into. So Friday was a very good day on the US e-minis, especially the Russell Index