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Steps For Establishing your Trading Goals

Sunday, July 4th, 2010

This post is for Friday’s market as the Index’s pulled off Thursdays intra-day low of 1006.

The market had a negative bias to it on Friday after the open which lasted for several hours. We started to flatten out around mid session and then made a run for it. The market did a pretty good job, but just before the close, no one wanted to hold over the long weekend and things sold off quickly. Modest losses for the Dow and NASDAQ as well.

Where do we go from here? Well, everything is down except for the monthly charts right now. It is hard to say, but I would like this market to hold up for while before any major cracks take place, but the market is not going to listen to me. As the days go by, we will afford more of a move down, so as for the Dow to get to the 9500 area or so. The index’s are not exactly in sync and some backing and filling may have to be done to get things lined up with each other. The number S&P 1006 was significant last week, but as time passes, if will allow for the market to come down a little more.  We had a 20 S&P point advance off of the 1006 number but I do see that there could be more room for things to settle in here. It is all pretty close. There is a chance that we could hold on to the lows set on Thursday and by Wednesday move out higher. I will just have to see how things shape up on Tuesday first.

There is a lot of room for the market to drop if it wants to, but if we can contain any new selling to afford the Dow to get to 9500 + or -, we could see a good move off of that number.  The new sentiment numbers will come out on Wednesday morning and there could be new developments there. We were holding at 41% bullish and a reading of 35% or less should trigger a counter move up.  Since the markets will be closed on Monday, that gives us only one day to see what it will do. A 6% drop is kind of a lot to drop in one week, but I have seen it happen plenty of times before.

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Friday’s trading was bit tough for me. It all turned out OK in the end, but I came up to my daily loss limit (4 S&P points) and could have went slightly over it if my last trade did not work out. My judgment was off and it caused me to struggle. I saw something, a big move coming and was acting ahead of the move so as not to miss it. I had built a position with three entries just before my last trade and it did not work out. Only a small loss around 4-5 ticks but I really needed to wait on that move for a better entry. The move was just brewing in the hopper, waiting to jump out, but I needed more patients. The last trade made up for all the mistakes and I hit better than my daily goal. I have similar notes on my screen below if you click on it, once and then again to blow it up if you care to see.  Video of the last trade in U-Tube video gallery posted on Friday too.

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Steps for establishing your goals:

1) Start by doing what you know works, then experiment with new applications. When in doubt, try to do more of what your already doing that is already delivering the results you want.

2) Build the right back up scenario’s into your plan. What might go wrong? Anticipate the unexpected at every level of achievement and don’t let concern about your own status as others perceive it, keep you from making the right choices in the right situations.

3) Get feedback from the right people on the pros and cons of your trading plan. People who give constructive feedback want to see you grow and people who offer only negative thoughts want to see you stay the same. Don’t waste your time talking to people who want to make you feel bad about yourself or question your dream altogether.

4) Keep your eye on the goal, but don’t get tunnel vision as it relates to other obligations. You have to balance your goals as it relates to the big picture. Do something each day that takes you closer to reaching your trading goals and is a reminder to yourself that you are going forward and making progress. The key is balance all other things of importance so other things do not suffer at the expense of reaching your goal.

5) Keep learning and growing and remember no one does it all alone. If the problems down the road look too large to you while you are setting up your plan, remember, you will be a big person by the time you need to solve them. To often we hold off on growth because we worry, “How would I handle all these problems”. We assume that we will never be smarter than we are right now and that we will never run into anyone else who offers skills and experiences that complement your own.

If you are a struggling trader and want to bounce an idea or two off of me, feel free to send me an email and I will give you my constructive thoughts on it. Many times traders do not have anyone to talk to about what they are trying to accomplish and it can be frustrating, because they may be going in the wrong direction. I won’t be trying to get you signed up with my trading course unless you want to, but if you ask a legitimate trading question or questions, I will give you a professional answer, no more. It is up to you to ask. If you struggle with concentration and focus, ask me for a free copy of my E-Book on “The Power of Concentration”.  Again, no strings attached and I will not be hounding you with this or that. Just ask for it and its yours, that is it, and again, if you have questions, I will be happy to answer. So, think it through and send me any email. We are half way through the year, make the second half count in reaching your trading goals.

Good Trading,

Vince

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Business Plan

Friday, February 26th, 2010
# Contract x $50 per x1 pt. x 2pts x 5 days wk = $ ——– Weekly Draw

1 x 50 dollars pt. x 2 pts x 5 days wk $500.00
2 x 50 dollars pt. x 2 pts x 5 days wk $1,000.00
3 x 50 dollars pt. x 2 pts x 5 days wk $1,500.00
4 x 50 dollars pt. x 2 pts x 5 days wk $2,000.00
5 x 50 dollars pt. x 2 pts x 5 days wk $2,500.00 $250.00
6 x 50 dollars pt. x 2 pts x 5 days wk $3,000.00 $500.00
7 x 50 dollars pt. x 2 pts x 5 days wk $3,500.00 $750.00
8 x 50 dollars pt. x 2 pts x 5 days wk $4,000.00 $1,000.00
9 x 50 dollars pt. x 2 pts x 5 days wk $4,500.00 $1,250.00
10 x 50 dollars pt. x 2 pts x 5 days wk $5,000.00 $1,500.00
11 x 50 dollars pt. x 2 pts x 5 days wk $5,500.00 $1,750.00
12 x 50 dollars pt. x 2 pts x 5 days wk $6,000.00 $2,000.00
13 x 50 dollars pt. x 2 pts x 5 days wk $6,500.00 $2,250.00
14 x 50 dollars pt. x 2 pts x 5 days wk $7,000.00 $2,500.00
15 x 50 dollars pt. x 2 pts x 5 days wk $7,500.00 $2,750.00
16 x 50 dollars pt. x 2 pts x 5 days wk $8,000.00 $3,000.00

This first 16 week section is the bedrock or foundation for going all the way. Not many people will be able to do this, I tell you that right now and up front. These results are not typical and I am not representing them as such. That being said, it is possible.

Just because most people do not have the discipline it takes to realize these results and the ones from below, does not mean it can not be done. It is up to the individual and their drive, passion, hard work and dedication to make this a reality for those that want it.

Many traders are quite satisfied to trade smaller lots and stick with that. I would add, it is easier to trade small size for the most part. When you increase contract size, it usually changes things for most people. Notice how I said, most people. Maybe you are not like most people and in-fact do not want to be put in a class with “Most People”. I don’t blame you, I don’t either.

What I am saying is, if someone does not lay out the possibilities to attain a specific goal, he will never know how to achieve it or even the idea of achieving it, will be foreign to him. So that is why I lay it out as such, for seeing the possibilities of what the exceptional could do.

The most difficult part in reaching this goal is not attaining the 2 points per day to acquire the results, but it is in the mental preparation and “mind games” that people allow themselves to become subjected to.

As you increase your size, there may come a point that you start to get affected by the money. You may say to yourself, “that is a lot of money, I don’t know about that, maybe I should trade smaller”. Here, the money is affecting your decisions and may start creating problems for your actual trading results.

In this case, it come down to personal choice and meeting your overall objectives. If your goal is to earn 200,000 a year at trading, that is a worthy goal. You may only need to trade up to a specific number of contracts and stop at that point. (The number of contracts to do that is 8-9 contracts at 2 points per day, that is do-able.) What you feel comfortable with at that time. As your account grows, you may feel more comfortable with increasing your size and you may not. Again, personal choice.

If you decide to go to the next level, it usually does get harder, but it is only in your mind. If you stick to the plane and do all the things I teach in my trading manual, listen to the mental exercises two or three times a week, which will allow the neuro-linguistic programming their to take effect and in addition, work on yourself as I explain, there is no reason why you will not have a shot at moving on to the next level.

17 x 50 dollars pt. x 2 pts x 5 days wk $ 9,000 $ 3,500 wk
18 x 50 dollars pt. x 2 pts x 5 days wk $ 9,500 $ 3,750 wk
19 x 50 dollars pt. x 2 pts x 5 days wk $ 10,000 $ 3,000 wk
20 x 50 dollars pt. x 2 pts x 5 days wk $ 10,500 $ 4,250 wk
21 x 50 dollars pt. x 2 pts x 5 days wk $ 11,000 $ 4,500 wk
22 x 50 dollars pt. x 2 pts x 5 days wk $ 11,500 $ 4,750 wk
23 x 50 dollars pt. x 2 pts x 5 days wk $ 12,000 $ 5,000 wk
24 x 50 dollars pt. x 2 pts x 5 days wk $ 12,500 $ 5,250 wk
25 x 50 dollars pt. x 2 pts x 5 days wk $ 13,000 $ 5,500 wk
26 x 50 dollars pt. x 2 pts x 5 days wk $ 13,000 $ 5,500 wk
27 x 50 dollars pt. x 2 pts x 5 days wk $ 14,000 $ 6,000 wk
28 x 50 dollars pt. x 2 pts x 5 days wk $ 14,500 $ 6,250 wk
29 x 50 dollars pt. x 2 pts x 5 days wk $ 15,000 $ 6,500 wk
30 x 50 dollars pt. x 2 pts x 5 days wk $ 15,500 $ 6,750 wk
31 x 50 dollars pt. x 2 pts x 5 days wk $ 16,000 $ 7,000 wk
32 x 50 dollars pt. x 2 pts x 5 days wk $ 16,500 $ 7,250 wk

So, you decided to go for it. You will need support. NO DOUBT. Trading for Big Money does not come easy. When things get a little tough in this section, you will need someone to help you through.

I offer support long after the purchase of my course and anyone scaling up their contract size over time is going to need help in keeping perspective, clarity and focus when targeting higher objectives. This is not an option. If you need and want much more time to attain these higher goal objectives I am sure we can work something out. Just let me know.

I currently have a small group of traders and do plan to grow, but I am not interested in growing into very large group. This way, I will have time to address individual needs from traders as the process of meeting their daily trading goals unfold.

33 x 50 dollars pt. x 2 pts x 5 $ 17,500 $ 7,250 wk
34 x 50 dollars pt. x 2 pts x 5 $ 18,000 $ 7,250 wk
35 x 50 dollars pt. x 2 pts x 5 $ 18,500 $ 7,250 wk
36 x 50 dollars pt. x 2 pts x 5 $ 19,000 $ 7,250 wk
37 x 50 dollars pt. x 2 pts x 5 $ 19,500 $ 7,250 wk
38 x 50 dollars pt. x 2 pts x 5 $ 20,000 $ 7,250 wk
39 x 50 dollars pt. x 2 pts x 5 $ 20,500 $ 7,250 wk
40 x 50 dollars pt. x 2 pts x 5 $ 21,000 $ 7,250 wk
41 x 50 dollars pt. x 2 pts x 5 $ 21,500 $ 7,250 wk
42 x 50 dollars pt. x 2 pts x 5 $ 22,000 $ 7,250 wk
43 x 50 dollars pt. x 2 pts x 5 $ 22,500 $ 7,250 wk
44 x 50 dollars pt. x 2 pts x 5 $ 23,000 $ 7,250 wk
45 x 50 dollars pt. x 2 pts x 5 $ 23,500 $ 7,250 wk
46 x 50 dollars pt. x 2 pts x 5 $ 24,000 $ 7,250 wk
47 x 50 dollars pt. x 2 pts x 5 $ 24,500 $ 7,250 wk
48 x 50 dollars pt. x 2 pts x 5 $ 25,000 $ 7,250 wk
48 x 50 dollars pt. x 2 pts x 5 $ 25,500 $ 7,250 wk
49 x 50 dollars pt. x 2 pts x 5 $ 26,000 $ 7,250 wk
50 x 50 dollars pt. x 2 pts x 5 $ 26,500 $ 7,250 wk
51 x 50 dollars pt. x 2 pts x 5 $ 27,000 $ 7,250 wk
52 x 50 dollars pt. x 2 pts x 5 $ 27,500 $ 7,250 wk

If you are on a quest for greatness, this section is where it happens. You will need all of the things mentioned in the section just above and now, more. If you are able to continue scaling up your trades and get an occasional day that you bring in 6 or 8 points, say two or three times a month, this will insulate you from the occasional day that you get stopped out at your daily loss limit. (-4 points) Having a daily loss limit is so important, I cannot express it enough. YOU NEED TO CONTROL LOSSES.

That is what is always needed at any stage. There would not be any reason to consistently trade for your daily goals and in one day or week, loose a ton or ground and cash. That is what happens to traders all the time. They make it fast and loose it faster.

You need to make it slow and hold on to it. In my trading manual, I lay out all the specifics on how to go about doing this and again, you will need some kind of additional support.

When you start out at week 2, after your 1st week warm-up, you will be risking $100 (1 point, $50 pt x 2 contracts) against an account of say $5,000, an average opening balance for many people. That represents 2% of your equity per trade taken.

After the second section from above, if you are still on course, your risk per trade is now down to .85% per trade taken. Very Good, considering that you have been taking money out of your account. After the third and last section, if you are again still on course, your risk per trade is down to a touch over .50% and that is outstanding.

Overall your risk is going down all along the way and you are taking cash out of the market. By doing this, you are lessening the impact that the money will have on you. You do not have it all on the line, something a gambler would do.

This is the reason why, I do think it is possible for the exceptional to achieve results similar to this. It, by any means does not happen very often, but again, do not let that hold you back. Just because others have tried and not been able to do it, does not mean that has to be transferred over to you, does it?

I DON’T THINK SO! and you shouldn’t either.

Trading for as lofty of a goal as described in this section is again not easy and it may be as previously stated that you trade up to a specific number of contracts and “Hold the Line, Stay with Me”. A famous line from the movie Gladiator. Sorry there, a little off subject. The point is, this plan is not for everyone.

A very attainable goal, is to start trading just one contract for the whole month. If you have averaged 2 points per day, high and lows, then you increase your contract size to two, for the month. If you do not get to a net 20 days x 2 points per day, you stay at one contract until you do. Then you can move on to three and so on.

If you stay close to this plan, with conservative daily targets of 2 points + an occasional windfall 6-8 points once of twice a month, you will be trading 12 contracts and on pace to making over $250,000 a year. That is making it slow and holding on to it.

For so many others, it will only seem like a dream and those that have failed will tell you, “It can not be done”. Don’t let anyone’s negativism take your dream. Back in the day, others who knew what I was doing tried to do just that to me. If I would have listened to them, where would I be know, no where close to what I have achieved.

In closing, I believe that trading for 2 points per day is achievable and feel totally confident in my approach in getting it. I don’t currently trade the size I would like, but that will soon change. Getting my daily goal and helping people get theirs has clearly defined my objectives at this time.

Good Trading to All

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FAQ

Thursday, February 25th, 2010



Frequently Asked Questions (Click on the Question to Reveal Answer)

Q. Can I trade more than 30 to 60 minutes a day?
A. Yes. You can break it up into two sessions if you like. Perhaps a morning session and afternoon session-make 2 point each session.

Q. Can I trade for more than two point a day?
A. My E-Mini trading course has advanced material for those who WANT to trade all day and earn more than two point a day. That’s fine to do, as long as you stick to the rules and not deviate from the trading plan. I personally do not advise it. The high side of the daily goal, four points, should be enough for most traders.

Q. Can I use this with Eminis other than the S&P?
A. Yes! my method works great with the NASDAQ Minis and the Dow Minis.

Q. What is a Day Trading School?
A. Many websites offer day trading training where you have to attend a classroom in a school. If you are not near one of these “schools”, you are out of luck. I offer my course as an “at home” learning experience. You learn at home, to earn at home.

Q. Is this a mechanical system?
A. Yes, and no. Yes, it is mechanical. No, it is not a “system”, it is a method. In my opinion, systems don’t work because the markets always change. Sniper Day Trading will give precise entry points that are highly accurate.

Q. How much money do I need to start?
A. Most brokers require a $5000 starting balance to begin. Amp Futures has a lower minimum opening balance of $ 2,000. That is very tight and offers little room for error, but it can be done if you have excellent discipline and really grasp the method. Following the rules for profitability is a must. Daily loss limit a must and may even have to be tightened to 3 points from 4. That is a daily loss limit of $ 150 dollars for the day. The worst you could do on any one day. So with discipline, focus and the right person, it is possible.

Q. Can I really make an income with a $5k balance?
A. Absolutely! Assuming you can follow the rules! If you can’t, then you will not make it, plain and simple. The choice, decision and outcome are up to you. You will have all that you need to make it. My method works, there is no doubt in my mind. The daily “Turning Points” video’s I do will be an incredible help. If you can build your contract size to just 4 contracts in 4 months time. Increasing your size just one contract per month over 4 months, you will be at a annual monthly income equivalent to making 100K per year, with averaging just 2 points per day. Some days you will hit 3-4 because the market will just give it to you, before you close the trade. That will make up for days you may fall behind. So again, yes it is possible.

Q. Can you recommend a good broker?
A. Yes, Tradestation Securities is the data vendor I use and also the broker, two in one. I have found that these guys are one of the best in the industry and have a very easy trading platform to learn. I recommend them also because it is easier and better to build your screen the way that I have it. We will be using the same platform and format.

Q. How much are commissions?
A. Commission are $2 dollars to buy and $2 dollars to sell per contract. It could be a little more or less depending on the volume you trade.

Q. How long will it take to learn this method?
A. I believe if you read the manual and watch the included videos, you will be underway to learning the Sniper Day Trading method within a week or two. You really need to review the daily trade videos and you really need to trade the simulator first. I will not tell you how long to trade the simulator, because everyone is different. You may need more than two weeks of simulated trading or just a couple days. Any experienced trader will be ready in a few day or so. The method is not hard to understand and apply, most people will grasp it quickly.

Q. What kind of support will I receive from you?
A. My undivided attention! I am not a sales man trying to sell 1000 copies here. I am a real day trader who makes his living from day trading-period. I truly want to see you successful. You will have my private cell number and email address and all the consultation you need.

Q. You mention discipline quite a bit. Why?
A. It’s that important. You need to be disciplined to follow the rules to the letter. That’s why I highly recommend listening to my “Mental Exercise Program” often. As mentioned I will be coming out with future releases of this and make them available to partners at no extra cost to them.

Q. Can I skip trading for a few days and still make money?
A. Absolutely. You will be making money every day you decide to trade! Of course you will not make money when you take a day off.

Q. Can I pay for my course in installments?
A. No. A simple one time payment is required. Please read our CFTC Disclaimer linked from the bottom of my home page. You should be well capitalized to trade futures and should not be trading with money you cannot afford to lose. If you cannot make a one time payment, you may not be ready for trading!

Q. How much can I expect to make in a year?
A. Great question. Personally I consider a $100,000 + a year good income for most people. Following my plan and trading 1 contract to start, and adding 1 contract after every $1500 profit,(every three weeks at 2 points a day) you could be earning well over the above amount a year in a very short time. Trading only up-to 4 contracts at 2 points per day would attain this goal. This is a very conservative approach and one that most should consider especially if you are new to futures trading. Everyone is different. If you do not follow the rules and lack discipline, all bets are off.

Q. Do I have to install your software on my computer?
A. No. I do not sell software! I am selling education materials only. If you don’t have a data package and broker, I really recommend Tradestation. They have it all, they are not perfect, but they have all the software you will need. My custom indicator can be set up on your screen without to much trouble and I can help with that if you need it.

Q. What if I lose my connection while I am in a trade?

A. You need to CALL YOUR BROKER IMMEDIATELY. Personally, I always have a back up computer with a Verizon Internet Card ready to go in case my cable modem goes out. It’s very prudent to have a backup and have your broker’s number on speed dial. I have not had this happen to me, but I am certain it could. I also recommend a battery back-up/surge protector in case the power goes out while you are in a trade.

Q. Will I make money if the market keeps going down?
A. Sniper Day Trading method allows you to profit from up and down markets! Go to the beginners page and read about shorting the market!

Q. Do you offer training after market hours?
A. I do offer an after hours market training to those who need it, but cover a lot of material in the daily video’s I put out after each trading session. This is usually a recap of the trading day and signals generated. I will schedule LIVE TRAINING WEBINARS occasionally as needed to help partners better fully understand some advanced features and how to read price action.

Q. Do you offer a live trading room?

A. Not at this time. I will be considering this in the near future, but not yet.

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Trading Psychology-Trading Discipline and S&P Emini

Friday, January 8th, 2010

Today is Friday, January 8th with early trading showing weakness.

As I write this early post, 9 a.m West Coast time, we are seeing a counter trend move back up, off of some early weakness. This is how yesterdays market started out and is what we will need to see in today’s market for us to hold on to the current momentum. It will be interesting to see how the market ends the day. Currently it is struggling with over-head resistence coming in at this mornings pre-market highs 1138 – 1139.  At one attempt I did see a large cluster of sell orders positioned at 1137.50 the previous short-term high. From that point, the next three prices had 13,000 contracts to sell. That was some serious volume with the market attempting to attack it and swallow it up, but it was just too much to overcome and fell back. I was able to catch some of that drop as you can see in the second video I posted below.

The day started out good for me and I tried to catch some of the early moves. I knew the unemployment numbers would be something that traders were watching this morning, so I thought to participate. I have a video of my first two trades below, but I don’t think there is any volume to it, I had my wires crossed, in my mic, not my head, thank goodness. The trades we good and took only two ticks of heat after my entry. My method said buy and I did, both times exactly as I should have. I grabbed the high tick as well, I did not want to miss the move, it looked strong.

Both of these entries were at what I call my turning points, like I posted in yesterday’s blog. Then, I did not take any trades, but just pointed out what they were for the day. I thought we would have the volume back today and with all the talk, I thought something big might happen. It actually turned out a lot quieter than I thought, but it was a big enough move for me.

I took a break and came back for a few more trades. I split most of my trades up and they are as follows and are in ticks. +3 +4 +1 /  +5 +10  /  +3 +3  /  -2  / +2 -1  / + 2 +5 /   

I often judge how I did not only by the net ticks, but also by how much draw down I take on the trades. On most of these, it was only a couple of ticks. That is what I strive for. In the loss that I had, I could have made it through that with my standard 4 tick stop and looking back in hindsight, I can see that, but I did not know that with surety then and had to protect myself. After I saw support come in, I did re-enter long at the same price. Losses are a part of trading and you have to accept it without it negatively affecting your next trade. To often, we look to get back into a trade to recover the loss that we just may have taken. That is the wrong reason to enter a trade. One thing should have nothing to do with the other. You need to place your trades based on what ever your trading model says that you should. Trying to make up for losses, is the wrong mindset and will hurt your overall performance.

Take each trade on its own merit, don’t let human nature get the best of you, by following your emotions. One thing that helps me is to know that you have and live by a daily loss limit. In the case that you have a bad day, you must have a cut off point to your trading, that says, I quite for the day. Don’t look at it as a defeat, but in a way, it can still be a mild victory. What I mean by that is, if you exercise the Trading Discipline to stop trading, for what ever reason, (not feeling well, too much on your mind, poor entries or just trading in weak price action environment) you can consider that a victory, because you know you have a cut off point for the day and you stuck to it, no matter what. That is a victory, believe me.

To often traders start out on the wrong foot and get in a hole. What happens after that?  Well, I think we all know, it can go from bad to worst. The worst, is what you are trying avoid, with bad being OK. I have a 4 point daily loss limit. If I go minus 4 S&P points for the day, I stop trading, I have to. If I am having a bad day and it happens to everyone, that is the worst thing that is going to happen to my account. It is a lose that I can live with and one that I can easily come back from the next day.

Let me say one more thing. I have mentioned this before a few months ago, but it bears repeating. When you are in trouble or even when you are not in trouble for that fact, “Trade by Exception”. What I mean is “Trade the easy and obvious”. Both of those are very important. We need to be relaxed when we trade and not tense or stressed. Try and calm yourself down before you begin and get into the right mindset. You can tell yourself, “I will not take any trades today unless they are easy and obvious trades. That will take the pressure off right away and give yourself permission to relax and just wait and watch price action along with what ever else your use to help you decide to take a trade. Price action does rule over all indicators,that does take time to grasp, but learnable.

Trading psychology and trading discipline are key ingredients along with knowing how to trade. You need all three of these vital components to be successful long-term. I will cover more of this in future posts.

So, there are some things for you to consider. It has more to do with how you approach the market, then anything else, but often this is exactly the kind of things that hold traders back from getting to the other side. Good Luck and Good Trading.

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Do you have a Daily Trading Loss Limit ?

Wednesday, December 2nd, 2009

Today is Tuesday December 1st, and the market is showing strength.

This is a good example of the lesson I talked about a couple of weeks ago. Stay open-minded and let the market work.

I have been saying for the past 3 sessions,  that the market needed to stay above the 1085 level on a closing basis to stay alive and so far, through all the news good and bad it has. I would rather see it that way, because it is a barometer of future growth in the economy and the job picture. The market does not listen to me, so it really does not matter what I or anyone else wants, but is a collection of mass emotions reflecting the economic standing of our country.

With the new month now here, the monthly chart as far as my work is concerned has just turned up finally, the weekly charts are up, the daily charts are up and the 120 minute chart just turned back up today. So the monthly, weekly, daily, and 2 hour bar chart are now all up. That being said, be careful, but it is looking like market wants to break out. We have been here about 5 times now and every time it fails. If it can’t go down, it may just be building for a break out up. I was looking for it about a week ago and it did not come and am not making any more calls on major direction because it is all to conditional right now. The only thing I know is that if the support at 1085 gets broken, that will spell trouble and we will have lost momentum and lower prices may be inevitable. That has not happened yet, so we are really still good to go as of now. As I have said, things change fast, so be on your toes if daily price moves are that important to you.

Yesterday, in the night trading we broke above the 1101 resistance pretty easily and continued higher today to close to the high of the day, a good sign at 11o9. It is going to be pretty significant if this market breaks out to the upside. We will just wait and see how it all shapes up, but stay open-minded and let’s have the market decide for us, it’s easier that way. If it does break derisively up, a short covering rally will add fuel to the fire, so the move can easily be explosive.

Today I took a few trades, the first was for -1 point, +3 ticks, +13 ticks & +8 ticks on a split trade, followed by +1 tick and -1 tick.  I picked up my daily goal in a little more than an hour, but I was not to happy with how it went down. I talk about it in the video below.

It does go to show you, that if you do the right thing, the right things will happen. To me, the most important thing is to trade correctly and not so much about the money. If you trade correctly and follow your trading model, over time, you will come out on top, if you have a good formula, method, system or what ever or how ever you trade. If you take “Non-Method” trades, that actually work out for you, it can be to your overall detriment.

Successful trading should really be pretty boring. You keep doing the same thing over and over again. You also keep getting the same boring results week after week, month after month. That is just what the “Doctor Ordered”. If you do the wrong thing and get the right results, it can build negative reinforcement and create bad habits that you will soon be forced to deal with and break.  So the moral of the story is, stay with your trading plan and only take trades that meet your criteria.

Yesterday I was talking about having a limit on your losses. Have you given that some thought as of yet. Every trader trades differently and rarely do you find traders that trade exactly the same. That being said, if you trade the S&P’s and carry a larger stop, say 2 or 3 points, you will need to have targets that are at least close to that if not much more. That is not me, but it could be you and you may be successful at it?  The other thing with that is you will have to be more selective in the process and you may only find 2 or 3 trades for the day that meets your criteria. So, you have to wait and sit for hours for your set up to develop. Question. Do you have the patience to do that? Do you have the time to do that? If you get antsy and take a less than desirable trade, you are now underwater by say 3 points and you only put on one trade. Can you see where this leads. A struggling trader who gets frustrated with his or her results.

These are the reason’s why I trade with small stops and work on precision entries. My target are often small as well, but I do have on average a minimum one to one Risk/Reward ratio on my smallest of trades and much higher on my larger ones. The other benefit is, you have so many more trades that can be taken, without waiting for hours at times for conditions to come together. Your wait is usually only minutes for the next potential method trade.

I will talk more about this tomorrow or very soon. Until then, see you next time.

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Big announcement at the bottom of todays blog

Friday, September 18th, 2009

Today is Thursday September 17th and the markets had a bit of a pull back today. The weekly chart is up, the daily charts are up, but the hourly chart has just turned down, resting  on support currently and has not technically broken down, but the momentum has slowed. Any break of todays lows will more than likely pull it down at least a little.  On the same token, if it is able to take out the last pivot high, it could easily continue with the uptrend on its way to 1100 plus. It appears to have momentun on  its side right now and having that round number so close, it may just try and make a run for it. Lets see what happens.

I have a chart of the S&P in short video showing the weekly and how close it is to a 50% retracement from it’s all time high of 1573. The low came in at 666 and the exact middle of the range is 1120. The momentum should carry it up there sooner or later. If it pulls back a little, that would in my opinion be a little bit better, giving it time to fill in the gaps and settle into its high ground. The faster it moves up without a rest, the more dangerous it is later on down the road. The same is true for the bottom that it put in. Take a look in the video what kind of bottom was put in back in 2001 before it took off. That was a solid base to build off of.

This bottom, is more of a V bottom and typically they are more susceptible to a re-test or at best another big pull back of 62% of this current move, when ever it ends. That to me would be the best case scenario. But long term, I am a bear. I will not let that opinion effect what I do in the trading arena, because I really only look too much smaller time frames. It is still good to be aware of your surroundings though.

I have not been trading lately, but have been working on getting my website up dated and my training material more complete.  This is going to take still just a couple more weeks until I complete what I want to accomplish. When I start up again, I will be preparing to follow the program I have designed by capturing at least 2 points a day and after 5 days of profit, moving my contract size up by one. So if I am on track I will be increasing one contract per week. At a rate like that, in 40 weeks I or anyone who follows me, will be trading 40 contracts for at least 2 points per day. On the days that I hit more, than two points, my hope is that it will make up for any day I run into my daily loss limit of 4 points for the day. So I have some room for error in getting to 40 contracts with the next 50 weeks with two weeks for solid vacation. If I or anyone is able to do that, they will be bringing in $ 1,000,000 million dollars a year. If you do the math you will see this is correct.

Let me just spell it out quickly here, 40 contracts x 2 points (50 dollars each point) = $100 x 40= $ 4,000 for the day x that by 5 = $20,000 for the week x 50 weeks = $ 1,000,000 for the year and that is if you stay at 40 during the whole year and not move it up.  Just getting to the 12 week in the process, trading 12 contracts takes you to $ 6,000 per week or $ 24,000 on a monthly basis, just trading for 2 points per day. Not to many people could do this, but I am preparing to be one of them. I say that humbly, because that is the only way I will be able to make it happen. I have a lot to work on and most of it is on me, myself and I.

My trading method works great and I have 100 % confidence in it. Again, the part that needs the most work, are all of the other area’s of a person’s life. Once you start trading with larger contract size, things start to happen, in your head. It is like that for most people, but it does not mean that it can not be overcome. You just have to identify the blockage and address it, head on, being willing to change to make it work. How committed are you? I know how committed I am and plan on using that and all my skills to take me on my journey.

Look for some changes on my site and that would include pricing. I will be making my trading program more affordable so that more traders will be able to take advantage of a low start up cost. I will have a back end fee tied to it, but that will be only if you are able to make your points and go forward. It will all be spelled out, so be on the look out for it in a couple of weeks.

http://www.screencast.com/t/n4SEGVZuf       Turning points for 9-17-09 / 5 minute video showing

http://www.screencast.com/t/dPsStSNIs         Weekly, daily and hourly charts / 5 minute video explaining

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S&P Day Trading: Where We Go From Here

Friday, July 3rd, 2009

This is Friday, July 3rd and the markets are closed today for the holiday

Yesterday’s action was no surprise, a big sell off. The indexes moved up on Wednesday a little more than I thought, but no real surprise there, just before a sell off, drawing in those who wanted higher prices. Wednesday I said that at the open we should see some continuation going higher by a few points, but once the trajectory of the up move is broken, you will see the wave down to lower prices. We needed to see how deep the sell off was going to be and if the market could support itself above the last pivot low and hold.

Well, we did just exactly that, but the sell off was already a little deeper which says we may be going lower on Monday. In addition, there was no bounce off the bottom and the market closed at its lows for the day, usually not a good sign. As of now the neckline has not been broken, but I would have to say that it does not look too good. The daily chart is definitely in a downtrend and has been for some time. The rally last week was a reactionary move back to the middle of the range and that is why I was looking for lower prices. The part that we didn’t know was by how much and how soon. Well, we are here now and to explain things a little further I put together a 5 minute video showing the price action and what we may expect over the next week or so, so check it out.

I have not been trading lately, my connection is still being restricted and I think I have two more weeks before I get my full bandwidth back. I will have to watch my screen time so that I do not go over my alloted usage of 5 gigs download and upload. The satellite venture was a failure, trying to get more speed into my system. I have heard there is another company that seems to do a better job, but I am a little worn out right now with the whole process.

This has been a good time for me to take a break anyway. I am not anxious about it, because I see the volume on the board has been very light. I hate that. It seems that the open is the only time worth trading, say the first hour. After that everything seems to have slowed down to a snail’s pace. That can work heavily against you, by testing your patience. You wait and wait and the market seems to do nothing and then, you put a trade on and it goes no where. That is not good. Even the afternoon trading is terrible. People are on vacation. It usually happens this way every year. So now is a good time for me to get things in order, rest up, and get my bandwidth and connection problems behinds me.

TRADING IDEA’S TO CONSIDER:  Anyone who is trading, now is a difficult time, so be careful. The market is not giving very many opportunities to get ahead and or recover for those underwater. You have to be much more selective and wait for the good trades.

Everyone who is currently trading, I believe you should be keeping a journal of your progress. Ask yourself before you take a trade, does this trade line up with my method and name out the key points. You should even make a check list and before entering a trade, or as you think a trade is developing, start marking off the characteristics of your method for taking the entry. Does this trade have this present, that present, and the other, what ever your entries call for. It only takes a few seconds and I think you should check it off as it comes together. This will keep you from getting clouded vision and reacting from emotion.

All of your training and practice will boil down to this: are you taking base trade setups? Meaning are you following your method or system. If you are not, it will be easy to identify where the problem is. That is why you need to have a daily loss limit, so that you have time to catch yourself before you bleed out. Every trader should do this. Yes, it takes time and effort to make up a sheet that has a check list on it. In fact, if the market conditions change and they so often do, you can have different sheets made up for different strategies. That way you have before you your map to follow. If you don’t have a tour guide, you will get lost in a foreign country, for sure. How will you know where to go?  But if you have a guide, you can easily follow your guide and or your map. This takes the stress away and frees you up to be on the lookout for your trades. Having all of your ideas only in your head adds more processes to compute and slows down the computer in your mind, but by writing it down and following a quick check list of things you are looking for, will free up valuable disk space for more meaningful insight into where do you go from here. Doesn’t that make sense? And if you follow it, it will make dollars too.

Have a great weekend and happy 4th of July

http://www.screencast.com/t/DF7nCk3Ye2 5 minute video of daily S&P and Dow

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Trading Lesson: Part Four

Saturday, June 27th, 2009

Today is Saturday and as I promised, I have a little more meat for you to chew on over the week-end. Give this some serious thought for those who are motivated to excellence and victory. I am sure this stuff will help many.

I will do a recap of what I have been discussing over the last few days. These are some of the most common reasons why traders fail to take the trading efforts to the next level. It can mean the difference to actually being profitable at a minimum, weekly, if not daily basis. With modest targets a solid methodology and the self discipline to follow through with your plan, a trader with the vision and will can overcome and make it to the other side. Do you believe that you are one of those who can, or are you one that only hopes he can one day? That is the question, how bad do you want it and are you willing to make changes and sacrifices along the way to get there?

Many would be traders want the money and time freedom that trading can offer, but are unwilling to address personal blockages that hold them back. You may say you will go the extra mile, but in reality it often times is only words. All one has to do is check your actions and attitudes, if they seem to overall be the same, it may be good intentions but no real action behind it, which will result in the same outcome, struggles and frustration. It is during these times that you have an opportunity to get going with the things that will turn your struggle around. Don’t look at it as failure, but as opportunity to overcome.

If you set a daily loss limit, like you should do as previously discussed, you are immediately taking the pressure off of you. The very worst that can happen to me today is “X” amount of dollar or point loss. I use double my daily goal as my stopping point. You must resolve in your mind that you will stop for the day and come back tomorrow with a fresh start and chip away at your goal for the day. The market will give you opportunities to get more in any one day, say double, triple or better your daily goal, but you do not know which days those are, so you trade with your daily goal only in mind until it is clear that today may be a great opportunity to pick up more and you make up easily your previous losses in the week.

It is really an excellent approach to systematically handle your trading venture. Identify in yourself NOW, do you have the resolve to stop trading for the day if you have hit this point. The risk if you don’t is a massive blow to your trading account, that most up and coming traders can not afford to absorb. So, “JUST SAY NO”. You need to go over it again and again in your mind that you are going to be responsible and do just as you say. Come back tomorrow and you will be fresh with a new perspective and approach.

Trading is not a sprint, it is a marathon and you need to pace yourself or you will get burnt out and fade right out of the picture, only having memories of “should of – could of – would of “. The time is now to create what you do not have and file it away, bring it up on demand when necessary. Again, if you are able to stop trading for the day after you hit a modest daily loss limit, you will have scored a HUGE VICTORY in your trading ventures.

You may say, “What is so victorious about walking away with a loosing day”. All the reason’s I mentioned above is why. You will prove to yourself that you can do this one thing and in doing so, know that if you find yourself in that position again, you will be able to take the appropriate actions as your plan calls for yet once again. This is going to establish confidence in yourself that you are not going to blow your account up and will remain in control at all times.

Going through the process and having one day where you are able to stop at this predefined point is going to possibly be a turning point for many in and of it self. This will be a big victory for many traders who struggle to limit the real bad days that seem to come out of nowhere. The market has a way of purging the system of weak traders who struggle with this lack of control, even if you have a solid trading plan and know what it is that you are doing. If you don’t limit your losses on bad days, you will never make it. The market has a way of only letting the cream rise to the top, don’t be one of the ones that settles to the bottom.

I got off on a whole new tangent there, but all of these ideas just came to me and felt I needed to roll with the subject for  while, before I run out of room for this posting.

I see that I have so much more I can say and will just go back over Friday’s posting and touch on that one point again. Look at both sides of the market and keep your biases to a minimum as far as short term direction.

This is so important. Don’t find yourself taking stop after stop and wonder what the heck is going on. If you take two stops in any one directional move, you are out of sync. If the market is going to break and you enter, you may be off on your timing or the market may push you out by a tick or so, but the direction is still right and you believe the move is ready, so you re-enter again and take your position, only to find out that you were wrong again and the market is just toying with you and many others to create doubt and take your capital.

Don’t give a third opportunity to do it again. Wait it out and give it some time, get up and doing something to get the blood flowing and re-access the situation after you see what is really happening. Often times the market will just go into a chop zone and start swinging high to low knocking out stops in both directions, step back after your second stop and wait it out. Once the dust clears you will see the real trade develop and it may be a 4 or 5 point gainer, easily making up for your earlier mishap, but you won’t be in that position if you don’t stop and wait it out. SELF DISCIPLINE, find it with-in yourself before you continue to trade and you will be glad you did.

Lastly, just think about this. When you cross the street at a busy intersection, you may be waiting for the light to turn green, we all do that, but when the light changes do you just start walking without looking hoping that others will obey the rules or do you look both ways before crossing. I always do, and you should too, if you value your life. Looking both ways says you see the cars coming in both directions and you know the risks. The same is true with trading. Waiting for the light to turn green would equate with just following indicators and going when it says to go. If you fail to look both ways you are taking a chance with your life and assuming all is well. Don’t take that chance, “ALWAYS LOOK AT BOTH SIDES OF THE MARKET AND KEEP AN OPEN MIND”.

Trade on, fellow travelers.

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Trading Lesson; Part Two

Thursday, June 25th, 2009

Today is Wednesday June 24th and markets found a footing to mount a nice rally on the open.

Today’s market action was a nice reaction to a pattern that was setting itself up all day yesterday. I wanted to show it but I decided to write something else instead. I knew something was brewing there. We had a real nice controlled move back up to the middle of the range, moving right to a 62% retracement off of the last pivot high before the break.

For those interested to look at this market action a little closer, I have below a 10 minute bar chart of the S&P with some market comments and break points identified on it. You can see where the pressure points were and draw some comparison to how price action flows for the last few days. You need to know what it looks like, so that in the future when you see similar setups and patterns you can with some degree of accuracy draw some conclusions.

Do note that the price action over the last few days has with it some gap days in the cash market, meaning that the futures had moved out above and below some of these support and resistance areas before the general public could take advantage of the breaks. Trading in the premarket before the open could have placed you in the break out areas as shown Just thought I would point that out. The street is not letting the public take advantage of the full move by taking it up and down before them, a sort of front running. Again, just an observation.

The market is now forming a larger “Triangle” formation, with resistance above and support below. Again you can see this in the chart below. I was expecting the move back up to the middle of the range, big time, but where from here as I said yesterday. We seem to have found support right where I drew that parallel on Monday’s daily chart. There is no other logical reason for the market to stop where it did. It is not close to any support from the left side of the daily charts, but has stopped right in its tracks in a not so obvious place.

Why?  Well, I believe that is where the unseen support comes in. Not so easy to see with the naked eye, but another reason why you should learn how to plot and chart parallels. It’s not a science as I have said before, but it can be a useful tool if you know how to use it.

Maybe tomorrow I will show how the downside move over the last 10 trading days was confined to a parallel downside channel as well. This gave you the downside potential target and the upside resistance area that we hit today. If you are trading for large targets this information can give you the patience and staying power to wait out the move until the objectives have been met, as long as the price action supports it Price always rules.

I will continue where I left off  yesterday in pointing out common and critical trading struggles with the would be trader.

Point number two was, “Reaching for trades, trying to make up previous losses”.

*** There is a right way to go about making up lost ground and I will discuss that after I point out the problem. When you find yourself down a few trades and in negative territory, most traders get taken over by a swell of emotions that usually makes things worse for themselves.  You get overwhelmed by your loss and how the market just seems to know where you put your stop and it goes to it like a magnet, another loss.

As I said yesterday, you can not allow yourself to bleed out. Take each trade on its own merit and shake off the losses. Be mindful not to lose your nerve and confidence. If you do, it is only going to get worse. You cannot make rational trading decisions from this negative posture. If you have 3 losses in a row and it could even be two in a row, you are now in the “PENALTY BOX” for being bad. It is obvious that you are not in tune with the price action and need to walk away and take a break.

Look at each trade and see if it meets the qualifications you have previously set up for a buy and or sell decision. If it has not, DON’T TAKE THE TRADE. Let me tell you, not taking a trade is just as important as taking one and is in fact taking a trading position, a no trade position. You will be amazed what a little time will do in offering a whole new set of price action reads for you to consider. But if you rush in too quickly to try and prematurely recapture lost gains, you are only setting yourself up. “Just Say No”. Moments later, you will see what it is you were looking for, the perfect trade setup.

One additional solution is to use what I had pointed out yesterday, by doing something physical, to get your blood pumping and oxygen flowing to your brain. I suggested doing 10 push-ups or more when you find yourself in any difficult position. You could do something else, like push a little iron, whatever you think you can do to break the destructive pattern you find yourself in. Some traders get paralyzed and cannot leave the screen as they continue to frustrate themselves to no end. Many destroy their account so that the pain will somehow stop. Don’t let that be you.

One last thing on this and it will be a big help in taking the pressure off. I believe that all traders have bad days and we know that is the truth, but you need to draw a line in the sand well ahead of time as to where is your cut off point for the day. If you don’t do this, you and your trading account are going to have that real bad day that you do not want to think about. Well, you have nothing to stop you, because you have not set up in your mind where you are going to stop trading for the day.

I have what I call double my daily goal as my daily loss limit. It’s enough room to breath but not too bad to make up the next day if in fact you get there. Minimum daily goal is 2 net points a day, but often is 4, so your daily loss limit is 4 S&P points for the day. If you find yourself there, STOP.

I will pick it up tomorrow, out of time and space for today. Trade on!

http://www.screencast.com/t/HQWZvmnef6O 10 minute chart of S&P with notes and comments

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Where is the Market going for the next 6 months? My thoughts!

Tuesday, May 12th, 2009

Today is Monday, May 11th and the markets pulled back off of last week’s highs.

Well, the market pulled back off of last week’s highs with a large gap down at the open. It initially had follow through to the downside but then started to pull back up. After the next couple of hours the market did manage to make a pretty good retracement back to the 50% mark.

It did this in the cash and futures market. Once that mid point retracement got hit, that was all it took to get the sellers to come back in force. It tried to mount a few rallies and the overall price action was pretty good, with good setups on both sides of the (long & short) market. It wasn’t until late in the session that it could not mount a rally and therefore sold off to near session lows.

As I said last week, the market may be marking a little time and moving sideways to move more easily to the outside resistance at the purple. I have this drawn up on a chart below. This is the same chart I posted last week but with the current price action on it.

I might want to mention here that last weeks sentiment numbers increased the bullish % from 36% to 40.5% and the level for the bears dropped from 37.2 % to 31.5. The amount of newsletter writers that think the market is going to drop went down by almost 6%. That is a lot.

What that means is, 6% less of them were thinking the market was going to drop from last week, so the opposite would be true with more of them now BULLISH. These numbers, especially the 40.5%, are really not extreme numbers as of yet, but maybe another move in that direction this week will pull the numbers to a neutral reading. That may give it a chance to get back to an extreme reading as the expected pull back develops.

A break of the blue trend-line that I have drawn on the daily chart will signify that the pull back has started. As that pull back takes hold over the next couple of weeks, I would expect support to come back in and at that point we could be primed for a real big move back up over this current resistance level. If this setup takes hold and the sentiment numbers are primed, look for a move up over the summer months. This is then again going to catch many in thinking that they missed the move and they now have to get back into the market at any cost. The trap will be layed out very carefully and with precision. You can participate in the move up, but you need to be very careful. Do not become married to your position, and be willing to give it up, depending on how much exuberance is in the market.

This is just a basic scenario and not anything I am holding my breath over, but it would appear that there is still too much bullishness on the STREET and this scenario is a way to catch everyone off guard. Just today, I looked briefly at Market Watch. It’s a website talking about the happenings on Wall Street. I saw, “New Super Cycle may be starting” and another that said, “Job boom coming”.

Well, everyone is entitled to their opinion and I have mine, but mine does not match up with theirs, that is for sure. I don’t like to be pessimistic, but from the way I see it, we are going to be set up for another massacre, but not just yet. The perfect timing for this is going to be September/October. This is going to coincide with the now famous flue coming back in the fall.

The “perfect storm” is going to be brewing from now till then. Either way, if it is going to be serious or not, the establishment is going to milk it for all it can, to create a scenario where people will not want to go to work, gather in public places, and sales for everything is going to go down. That will quickly get priced into the stock markets future earnings and the outlook will be very dim. The stock market will sell off fiercely and those “In The Know”, will clean up – once again. Will you be ready?

This senario may or may not happen, although I personally think it will. I am always going to look at both sides of the market and I will react to it when that time comes and not before. We need to read price action and interpret it. We can have an opinion but it needs to be held loosely. Always tell yourself, the market can do whatever it wants. If you see an uptrend developing, ride it out. If a downtrend has just broken, get on it.

On the daily chart I posted, I have identified the calls that I have made over the last months. I have made other calls before the ones posted and most all of them are very accurate. I can only make the real call, when the price action is before me. So stay tuned and see how all of this is going to turn out.

In my trading today, I did well, with only one loss for three ticks. I made it to double daily goal of $1,000 and stopped. I traded from a little after the open about 6:45 to just before 8:00 am, about 1 hour and 10 minutes. On the last big move, I had quite a bit more equity in the trade, but I gave it more room than I usually do and picked up only about 1 point when I had a lot more, but that was the price I paid for a bigger return, it was fine. I topped off the day with only a tiny trade to get to my desired goal.

My basic target for the day is really 2 net points or $500. My daily loss limit is 2 times my stated daily goal, so I have a maximum daily loss of $1,000, which I have not hit since I started this back in late January, so far, so good.

http://www.screencast.com/t/xSIcLphoo Today’s equity chart

http://www.screencast.com/t/2E9T8IP0VI Daily chart of the cash S&P

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