Thursday’s Best S&P Turning Points Results: The suggested short @ 3790.50 was only good for a 4-point scalp before stopping out.
Quick Tip: Daily Risk
Successful traders manage risk in many ways. The obvious stop loss order is only the beginning of a full-blown risk management plan. Daily risk is part of the plan.
For example, other than the trading floors at institutions with household names, there are plenty of Proprietary Trading businesses. These are privately owned. They hire, train, and finance traders who work for a percentage of the profit.
Consider this: they are betting on inexperienced traders to become profitable in a reasonable amount of time, trading with their capital. Whoa!
How important would risk management be to you if you owned the business? Number 1, for sure.
The Risk Manager can monitor every trader in real time with a dashboard of information showing results. When any trader, new or seasoned, hits their daily loss limit they are pulled from live trading. Period. It could be at 10 AM.
Expert traders know that doesn’t mean an early tee time at the country club. They stay in the market trading simulated to continue to hone their skills and get back their confidence.
Yesterday I hit my daily loss limit by 10:30 AM. Frankly, I could feel the revenge urging me to stay the course and win it back. But I know better so that was a positive entry in my journal. I managed my emotions properly.
If you don’t already have a daily loss limit, do it. And have the discipline to stick with it.
The World Sentiment Index: (+100/-100) EASES from -33 to -17 in a world of mixed sentiment and low volatility. Historically higher closes from the open occurred 74% of the time. However, this outlook is likely to change after the Non-Farm Payroll report @ 8:30.
Catalysts: Employment Situation @ 8:30. Putin says “not bluffing” on nuclear threat. Scattered Fed-Speak.
Today’s Best S&P Turning Points (consider wider stops and less size in fast moving markets):
Short 3891.00 stop 3896.75.
Buy 3718.75 stop 3713.00, if that fails try 3674.25 stop 3668.50.
P.S. Multiple strategies, software tools, teammates, and coaching. Learn why you should join our team here. For a personal consultation to assess fit (without selling) email me for an appointment: mike@thedailymarketforecast.