Trade Aptitude

Results of Monday’s Best S&P Turning Points: Neither suggestion triggered. 

Today’s Best S&P Turning Points (consider wider stops and less size in fast moving markets): 

Buy 4001.75 stop 3998.00. Short 4052.50 stop 4056.75. 

The World Sentiment Index: (+100/-100) DIPS from -43 to -50 with all major world markets bearish. Historically price closed lower 58% of the time. 

Catalysts: Employment Cost Index @ 8:30. Home Price Index @ 9:00. Chicago PMI @ 9:45. Consumer Confidence @ 10:00. Risk off while waiting for FOMC tomorrow. 

Quick Tip: Wide Range Exit

Imagine you’re in a trade with multiple contracts (shares) and your planned profit targets have been met. Price is continuing in your direction, and you have an open position albeit smaller. You’re looking for a good exit not wanting to give up too much profit. 

How about giving up no profit? Can you pick the end of the move? Sometimes, but enough of the time to warrant consideration.

Here’s how: Price moves in impulses and corrections. It’s the significant impulses that offer excellent exits leaving very little profit on the table. 

This move goes by a few names; wide range candle, speed candle, parabolic move, etc. When you see this it’s time to lighten the position or end the trade. Frequently fast moves expire and reverse rapidly. Yes, you’ll miss an extreme continuation once in a while, but the net result should be in your favor. 

Study your asset’s historical performance and measure these moves to know in advance how much movement is “enough.” 

In our trading room we manage multiple strategies with edge and discuss best exits on open trades as a team. Learn more here. 

Trade Fearlessly,

Mike Siewruk 

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