Posts Tagged ‘tick chart’

As a Trader Thinks So Is He #3

Thursday, October 6th, 2011

Today is October 6th, 2011 as the expected rally on Wall Street continued, taking traders by surprise.

We did hit exactly the high of the outside resistance I mentioned in yesterdays post of S&P 1160 and stopped. I mentioned this number also early on today in a training session for members and showed them why.

Currently we are at the top outside resistance as I describe it and two things are next going to happen. The first one will exhibit a greater degree of bullishness but both are good. If we break over this current level with conviction the next level up is around another 30 S&P points at 1190. At that time a pull back to the current 1160 area will be in order on our confirmed way to higher prices. The next scenario is a pause likely tomorrow, with a range bound day and a pull back Monday and Tuesday to around the 1113 / 1120 area. Followed up by a move back up and over the the current 1160 area to again much higher prices.

Both of those moves are not what traders would have thought three trading days ago, but it exactly what I had in mind. I did say back then in part that the S&P should stay above the 1120 area and it got flushed out during the next trading day, only to zoom past all of those levels to the amazement of many.

Currently, for a confirmed move, it would be to soon to enter, but a move up off the current level would be the early entry move. A second chance on a back fill from the would be break will likely be offered so there is still time either way to get in on the coming move.

I know this may be a shock for many, but what I see currently is the same thing I see in a tick chart of very small size, no different. Again, it is to soon from that stand point to enter, so hold still and wait.

I don’t want to sound like I am giving investment advise, so all of this is just my opinion and everyone should make there own mind up as to future direction. This is my thoughts talking out loud, though very unpopular I feel in good company.

Above is the one trade I took from today for roughly 2 & 3 points. A very easy trade with virtually no draw down and no waiting for things to happen, just the way I like it. As I mentioned yesterday, we need three things to make this work for us, Time, Place, Energy.   Those are the things present in this trade and that is why it worked when it did. It was the right time, it was in the right place or (space) and it had the right amount of stored energy.

There is a reason and it is duplicatable for anyone who can follow, but that is not always that easy. You have to have the right mindset to follow through with what you know to be true and that will take me into where I left off yesterday.

===========================================================================

Two days ago, I started a series of trainings that will be continuous for the near future. The first one was laying the ground work stating that our souls, not spirit is made up of three things. (Mind, Will, Emotions) Those are the things that define us as who we are. We need to get into all of those areas to find out who we are as it relates to our trading and much of that leads us to the second post yesterday which was tied to our thinking.

“As a trader thinks, so is he” is the title of today’s message. This is a term taken from the Bible, Proverbs 23: 7 , which states, “as a man thinkith in his heart, so it he”.  A famous writer, James Allen, picked up on this and wrote a book nearly 100 years ago about the truths of that statement. It is not really a spiritual writing even though spiritual principals are highlighted, but filled with immeasurable truths based on just that one line.

As a man thinks, so is he; is the basic idea, which is all based on the fact that our thoughts determine the outcome of most everything we do. If you feel you are a failure, you will only see defeat. If you see yourself as always making the wrong the trading decisions, then your next trade will be a loss. It is just that simple. The way you see yourself is what you are going to get. Look past what was and look to what will be. There is the answer and the ideal you are seeking.

Let me quote a section from James Allen, “As A Man Thinkith”;

“Only by much search and mining are gold and diamonds obtained, and man can find every truth connected to his being, if he will dig deep into the mind of his soul. That he is the maker of his character, the molder of his life, and the builder of his destiny, he may unerringly prove, if he will watch, control and alter his thoughts, tracing their effect upon himself, upon others and upon his life and circumstances, linking cause and effect by patient practice and investigation. And utilizing his every experience, even the most trivial, everyday occurrence, as a means of obtaining that knowledge of himself, which is understanding, wisdom, power. In this direction, as in no other, is the law absolute that, “He that seeketh, findeth; and to him that knocketh it shall be opened.” For only by patients, practice, and ceaseless importunity can a man enter the door of knowledge”

This says a lot and can write a pages just on what was said above, but let me start and just continue tomorrow where I leave off.

Gold and diamonds are not easily found it take work to uncover those treasurers. It will take work to search within our souls how best to control our minds, our will and our emotions. Anything of value rarely comes easy but this is the necessary search that  James Allen is talking about.

You can find what it will take to follow your trading method, what ever that is for you, if you make a decision to do so. It all starts with a thought and followed up with a decision to follow that thought, and then the will to see it through. Your answers are within you, search for the truth even if it hurts, that is the beginning.

More to come in tomorrows post.

Tags: , , ,
Posted in Trading Psychology | No Comments »

Another Spot On Market Call

Tuesday, August 30th, 2011

Still on vacation till after labor day, but will post a larger chart of the days turns. At the bottom of the post, I will put up yesterdays market turns, again, this is a larger trade structure than I trade, but it can be traded by those members who choose to.

Another spot on market call;  Last Monday, 8-22-11, in my blog posting, I called for the market to hold in the current area, and rally. At the time, the close was S&P 1123. A confirmation to the first target will be triggered when 1140 is broken and it hit that next morning. I said that we would soon see 1220 on the S&P with that rally and today, towards the end of the day, we hit the target 1220.10.  Then we saw an immediate price rejection of the target and prices reversed immediately in the last few minutes of the day.

Calling the daily market is no different than calling the hourly, 5 minute, or any size tick or range chart. It is all the same as the stock market is fractal in nature in relationship to different sized charts. The moves are proportionate to your risk at each level. In addition, less trades are generated when you increase your time frame.

I don’t trade the larger time frames, but I always look at them even if I am just scalping for points. It is a lot less work as you increase you time horizon as well.  Many traders search for what is there dominant time frame, short term, intermediate, long term. Each of these are and can be different for every trader, but I feel you should trade in line with your dominant trading personalilty.

As you do, you will not be fighting the process with either over-trading or under-trading, as that will be apart of your trading strategy. You only have to stick to your plan and excel in what you do.

When trading, you have to create a frame work to work from. Market structure is built and price is and can be projected through three elements, time, space and energy.

I have written about this before, but it might be worth repeating. It all boils down to understanding and building that frame work or market structure. The three elements mentioned above are all apart of that frame work and that is what gives you the edge.

The elements when understood, in conjunction with each other, can show you exactly where price will go in many instances and a likely time for its arrival as well. This can be done with small tick charts while targeting 2 points on the S&P and or a higher time frame view for 10 points or more. You will always have to invest more time for the larger moves and your exposure is increased, for the shear fact that you are in the market, but that may be a traders style, to trade less and shoot for that higher profit/loss ratio.

I have trained myself to trade for short targets usually in the 1-5 point target range and that will depend on market volitility. I always trade at a minimum of a one to one trade ratio and have a daily stop out point so that I will never get a blow out day where losses are off the charts.  I like to get a daily target that is close to what my daily stop out point will be for any one trading session.

This is like having a 1 to 1 profit/loss ratio as it relates to the trading session. Having a loosing day of 3-4 S&P points will be overcome by just one normal regular session of gains that is equal to that. So, if you take a loss for the session, the next session puts you right back at where you were before the loss and you don’t look back.

I do look for on occasion those days where price action is telling me to take the easy and obvious trades for much bigger gains and point values. There, on those days, I can come away with 3 times an average daily goal, but I never really go looking for those days. They just come to me and I go with it.

It is a good idea to not trade for more than two hours at one time. Traders don’t really realize this, but there brain will begin to slow down, and the high level of concentration necessary to capitalize will get lost. There, is where traders get into trouble. Trying to come back when they are not at peak concentration levels. Mix in a little emotion and you have a receipit for disaster.

This is the area, traders fail to hold it together. Many don’t really understand why they put on the trades that they do, as when in this distructive mode, only until after the dust settles and they look on in horror.

How do you stop that from happening in the first place? That is a question I would bet thousands of traders would like to know the answer for. I will only give you a very basic answer to this at first and may continue it in my next post, but much of that behavior and losses, could be eliminated by only trading for smaller blocks of time.

If you are a position trader still within the course of the day, then you need to wait hours at times, for your one or two trades a day. There is not a lot you can do, since your trading opportunities don’t come often, but in the case of much smaller time traders, you need to zero in all your energy into a small block of time and get your points there. When you stay to long, out of greed, or any other reason, you are often times asking for it.

Traders will never understand every twist and turn of the market, but we need to weed out that which we do understand and capitalize on that and just leave the rest. Always trade the easy and obvious is a motto I say all the time, that will serve us all well as we trade our way through the markets.

Good Trading to all, Vince.            Monday’s larger picture view below!

Tags: , , , ,
Posted in Market Call | No Comments »

Trade Lesson and Encouragement

Friday, November 26th, 2010

Saturday, November 26th, 2010. I will give an update to last weeks action on Sunday afternoon, but below is part of an email message I sent out to my group to help them stay focused and give a little encouragement. This is part only and felt I could share this much with my readers here today. It is a little long, but feel it has value enough to share with this group as well. Best wishes to all my readers,  Vince

————————————————————————————————————————————————–

One of the reason’s traders have more problems than they should, is that they trade to long and have too high of an expectation. The odds for most traders to loose money greatly increase when they stay to long, that I am convinced of. Unless you have an unwavering ability to sit and wait, most will find themselves over-trading, looking for trades that don’t meet the criteria. It is in these times, frustration and revenge trading can also give birth to additional unwanted losses.

So, to meet a minimum base trade goal that is mixed with limited time to achieve it, small high percentage trades can get you there quickly and easily. When you have it, walk away and do not give it back. If you need screen time, switch to Sim Trading and do not go back to live trading no matter what for the day. When you feel comfortable with the method and find yourself reaching your goals day after day with limited time invested, enjoy some of the benefits traders voice by enjoying your free time. Most traders will say that they like trading and want to pursue the career because of “time freedom”.

Back to meeting our base goal. To hit two points per day all a trader needs to do is to hit two (2) one point trades, or one two point trade, or any small combination their of. The key is to hit those trades with a high degree of accuracy and with confidence. Using the method to Snipe off a few of these trades is not that hard, but if you reach your goal and continue to trade, you will and or can be met with unfavorable conditions, (slow market, choppy random moves, like Wednesday late afternnoon.) Having the ability to stay in control is essential. I hear many times that traders are hitting good point moves in the morning, but give it back in the afternoon. That is more common than many will like to admit. The easy solution is to stop trading.  Traders trade for the money, or that is what most will say, but often times trading fills some other need in our lives that we are often times not aware of. Each one of us needs to search ourselves to find out if that is true and if it is, what are we going to do about it?  This is where the hard work lies and it is the work that many traders are not willing to do. I encourage everyone to search themselves and see how if any of this applies to us, myself included.

A different way of looking at trading for such a small target is, that if we can get so good at hitting high percentage trades and get them quickly, you will never have to worry what kind of market you are in, as it will work in all market conditions, choppy or trending. As time goes on, your ability to see the bigger picture will improve and you will have the ability to stay with a trade for longer runs when the market show it to you, exiting with method rules. Again, getting so comfortable with the small stuff, will open doors for us to trade much larger contract size. Trading 20 contracts for one point is $ 1,000 dollars and can be had in a minute. Two points in an session is 2K for the day. That is a lot of money anyway you shake it.  The key is to look at this with a long term perspective. Becoming tops in any field always takes time, work, dedication, discipline, patience and the ability to stay focused.

Sniper Day Trading is basically a scalp trading method, but it can be “morphed’ into something more or combined with other trade principals to enhance or adapt it to your own style and or personality. With a scalp trading strategy, the emphasis is on high percentage short term moves. To get that, the entry is key. We don’t want the price to back fill or move against us much if any. To do that, precision entries are the key. Without precision entries, we will be risking to much on the trade when compared to the reward. Risking one point to make one point is called a 1:1 ratio and is the smallest ratio I like to see when I trade. There are other strategies out there that only put on higher ratio trades and that is fine, but it is not the basis for what we do. I have adjusted my trading habits a bit over the last year so as not to take many counter trend trades as per the method. This has given me more opportunities for larger point moves but it requires one to wait much longer for those set ups to develop. This has helped some traders to screen out some of the smaller trades, which was in part why I did the updated version.

The market is always changing and there is rarely two trades exactly alike, but they often will show very similar characteristic’s as I pointed out in the last video’s. In those last video’s I did, since I only focused on a small tick chart and no accompanying larger charts to create a clearer structure for us to follow, the emphasis was on the simple patterns only. One can not and should not only trade based on one small tick chart. You can not see what else is going on around you. So don’t get confused their with that. The next video’s will include everything up on the screen and will take you through the process and full method details. It may be good for some to go over the rules for entry and exit’s. The market consistently expresses itself on the screen each day. If we learn to listen to it and adapt ourselves to the price action we will be in tune with the market and will be able to see larger moves coming in advance. Trading for larger point returns requires a lot more from us as traders. You have to have the ability often times to trade for several hours to only take those trades that may meet say a 3:1 trade ratio. They don’t happen that often and you will be required to risk more on your entry/stop. Risking 6 ticks will require you to make 4.50 points on the trade. How many trades meet that criteria in a session, not that many, but they do exist, but not without putting in the extra time it will take to wait for the setup and then again to wait for it to come to fruition (come to pass).

This is where I find an advantage in trading the way I do. Successful traders will so often tell us that trading is more of an “Art” than a “Science” and I would agree with that. So we need to let the art of the trading method express itself out on the screen. Each one of us has the ability to do this, but we need to see the big picture and let your knowledge of this method express itself on the screen. There are rules to follow as per entry. There are rules to follow as per exits. If scalp trading, setting a 1 point target is fine, no matter what the environment, even if you see the move continue on up. No trade management is needed in that environment except possibly moving up your stop a tick or two as you approach your fill. If you see a large consolidation that is building and building, it will likely carry with it a much bigger return and taking a T-2 type trade with no targets but stops only, will work just fine. There is more work to manage the trade in this situation. If you scale with multiple contracts, taking off half at say one point or better on strength is something I often times like to do. This locks in profit and now you can not loose on the trade. You may be giving up what you could have had if you had not closed out half your trade, but that is trading with hindsight and not realistic. By taking half off early, you can often times hold on for a long move up, because you are more relaxed and in control. Ride the move up as per the method, their are many ways you could proceed…………………………….

Well, thanks for tuning in to part of this lesson, as the rest of it gets a bit more specific and am not able to share.

I wish all my readers the very best this Holiday Season.

Vince

Tags: , , , , , ,
Posted in Trading Lesson | No Comments »

Sustained Bull Move Coming Pretty Soon

Monday, July 19th, 2010

Today is Monday July 19th and we saw some pretty good moves today, on S&P but just consolidated after Fridays selloff.

The Dow Jones was up about 55 point, the NASDAQ up around 19 and the S&P futures flat. We moved sideways as the end result but had a nice sell off around 30 minutes after the open. I saw that one coming and picked up 3 points, 5.50 points and 8 points on the last part of my trade. Just the one trade for me today. I am trying to trade the early market hours and today was a good reward. I normally would have missed that move and had to come in scalping a bit here and there. The move I entered, looked like it had everything I wanted in a big move, and there you have it. I do like to scale out of trade often, but don’t do it every time. If you trade multiple contracts, scaling out, releases some of the pressure associated with having the trade on. It gives you stamina to stay with the rest of the trade, as it could jump up against you and take half of your gains back in a flash. Covering into weakness (short) is a way to lock in the profit at some of its better fills.

The downside is that you could have had more if in fact you waited, but I often would rather take a piece of move when I have the advantage, even if it keeps going. I was able to pick the bottom of the move as you can see in the screen shot. I always like it when a plan comes together. The market turned up just after my out and the last signal long was a sustained move. I likely would have skipped it, as the downtrend was looking pretty solid. More basing could have persuaded me to change my mind, but we did not get that and I was gone.

I have been looking for the market to get to 1050 and as low as 1040, but with today’s lows coming in at 1057, and seeing how things are shaping up on the charts, I would have to leave the possibility open that we have seen the low. I only say that, so as not to taken by surprise and see the market move up without me spotting the real sustained move. The confirmation will not happen until 1090 S&P, but after that price, you will start the beginning of a sustained bull move to the upside. It does not usually matter much for me to catch the bottom, as I am  just watching and identifying   the larger turning point in the market.

I see things that are saying, we could go up from here. To me, this is healthy, because, the worst thing a trader can do is have strong preconceived opinions of the market and loose your objectivity. If you only say, this market is going down, you will not see when it is going to turn and will not be able to trade it, even if everything says that this is a great long trade. Your mind is a powerful thing and is often the main reason why traders struggle much more than they have to. Making repeated mistakes and not being objective, is one of the worst things a trader can do for his confidence.

So, take each trade on its own merit. Tell your self to look at both sides of the market and don’t get fixed on any one idea or outcome. The chart will talk to you if you know the language.

If anyone has questions or needs a little advise off the record, just email me and I will do what I can for you. If you have a stock that you would like to see the turning points on, just let me know, and in what time frame you prefer to see it in, weekly, daily, hourly, 5 minutes, 1 minute, tick chart, volume chart, range chart, what ever you use. Also, if you want a free copy of my branded E-Book, “The Power of Concentration”. It is available for the asking. I won’t be pounding you in-box with this or that. Just trying to help. All I ask is that if you get the book and or anything else I might send you, to send me a reply letting me know that you received it and that’s it.

Enjoy the summer, and get some fresh air. Vince.

Tags: , ,
Posted in Profit Day | No Comments »