Thursday’s Results: The suggested short @ 4504.50 ran 38.75 points to the next level where buying 4465.75 stopped.  

Quick Tip: Simplify

When you meet someone new socially the conversation usually leads to “What do you do?” Answering “I trade the market” usually brings the response “You think it’s going up or down?”

This is an important decision you always make before you trade. Is the asset you’re trading likely to go up or down and for how long? Before you can answer you need to identify the timeframe you’re trading. You can be Bullish long term but Bearish for today and vice versa. You may want to keep a grid with short, intermediate, and long-term timeframes for your Bullish and Bearish outlooks.

Opinion on direction and duration is worthless without evidence, analysis method, or data. You need a formula to ultimately answer the question. There are many. Here’s one that is simple and historically sound....

Tuesday’s Results: The suggested short @ 4414.50 stopped out for a 5.75-point loss (per contract).

Quick Tip: Admission

Five losers in a row yesterday and passed on a few trades that were winners. If this hasn’t happened to you it will. Afterward I received this text from a member of the team…

“I am sorry you took a beating today. You REALLY do lose gracefully. Well done! The worst thing about trading isn’t losing trades, it’s losing trades AND skipping the winners. Our minds play tricks with us on such days.”

So, what are the lessons here?

First, if you’re upset about losing you’re taking on too much risk. Lower your position size.

Second, review your performance. In doing so I realized that one trade did not fulfill all the rules. I shouldn’t have taken it. It was a momentary lack of discipline and attention. Knowing this and admitting it is a powerful tonic for improvement. But you won’t get better if you...

Wednesday’s Blog Levels: Nothing triggered in the day session

Quick Tip: Uncommon Success.

The chart above shows two trades from the Globex session leading into yesterday’s open. You’d call that the perfect night. Two 29.50-point runners from level to level. Set and forget. Wake up happy!

Unfortunately, it’s not common. But it does happen every month or so. As the great Wayne Gretzky said, “You miss all the shots you don’t take.” If you’re not planning a couple of set/forget trades for the Globex session before bedtime, you’re missing some big winning shots.

Oh yeah, sometimes you’ll wake up to the little losers. Missed shots. Small if you’re disciplined. No big deal.

If your trade plan doesn’t have a unique ruleset for the Globex session you should get one. Right here! We’ve recently introduced a new membership, only $99/month with the current coupon code. Just two S&P points. You’ll get all the...

Tuesday’s Blog Levels: Neither trade triggered.

Quick Tip: Embrace change.

Successful investors and traders alike have a rule-based strategy that provides them a financial advantage or “edge.” A combination of fundamental and technical analysis are typical components. Another analysis you can add to the recipe is investor “mood” commonly called sentiment. In other words, do market participants feel bullish, bearish or neutral about the future?

While every region and country has a unique economy, given the volume of international trade those individual economies are part of a larger “global” economy. The U.S. economy is the largest in the world but more importantly for us it is also the last market traded on the daily clock. This allows U.S. traders a glimpse at how the Asian and European markets are trading before our stock market opens.

Many years ago, I developed a simple indicator for world sentiment, which I call the World Index. The...

Monday’s Blog Levels: The short idea never triggered and the market opened below the long idea.

Quick Tip: Powerful Habit

Do you know anyone who read the Bible, Quran, Torah, or Vedas only once? (Sorry if I missed your faith but you’ll get the point in a moment).

You read anything enlightening once… “Interesting! I didn’t know that. I’m definitely following this advice!”

Result: A few days of spotty application. Your experience is now called “history.” You didn’t change.

You read anything enlightening a few times… “I’m getting this. I see how it’s changing me for the better. I feel calmer, more intelligent, motivated. Wow!”

Result: You have some new habits. You’re seriously applying. Your experience is now called “real.” You’re changing.

You re-read anything enlightening regularly… “I knew that and forgot it! Studying this needs to be on my calendar....

Yesterday: The suggested long at 4470.50 only bounced 4.75 points before continuing down.  

Quick Tip: Breakeven is a win.

Big win, little win, breakeven, little loser, big loser. All the outcomes of your trades. You don’t allow for big losers so that leaves all acceptable outcomes.

You can turn some of those little losers into breakeven trades. If you move your stop to breakeven after a pre-determined move in your direction (we use 4 S&P points) the outcomes are big win, little win, breakeven. Your drawdowns will be smaller. Your equity curve will be smoother.

What’s the downside? Subsequent price action doesn’t touch your original stop and the trade went on to your profit targets. You missed a winner.

You need confidence in your strategy and rules to succeed. Choose the style that appeals to your personality. Then keep records of every trade setup, taken or not, to find out which is better financially.

Today’s Best S&P Futures Turning Points:

...

Tuesday’s Results: The suggested short @ 4580.50 nailed the top of the day session and ran for 63.75 points to the close. How much did you get?

Quick Tip: Orphans.

Entry decisions are easy. Exits are tough. If you managed this trade you likely took profit before the end of the day.  There were two 15+ point corrections in the trend down. Watching that money leave your account is tough. Not getting the full move of 63.75 points is tough, too.

All-star trader Larry Williams, in his book Long-Term Secrets to Short-Term Trading, finds that his best trades are those exited at the close. He researched and tested all kinds of exit strategies to determine this. His advice: enter and walk away. Come back at the close.

Another great trader I know, Bob Dunn, would say something similar. His view is NOT to cap your wins but let them run. In fact, this is a common view from many great traders. Cap your losses and let your winners run.

The challenge is this: you’re reviewing...

Subject: The foundation of success. 

Success at trading, at anything, is formulaic. No one stays successful at anything without a proven formula to follow. What’s yours? 

You may think it’s your trade plan. You may think you need the hottest strategies, the best broker, more risk capital, and better sources of information. All that surely helps but the foundation for your success starts within you. It’s your belief. 

Do you honestly believe you can become a top-notch trader? Or are you thinking of giving it a try? Trying isn’t enough to overcome the challenges of anything worthwhile. It’s a negative belief. Knowing you’ll succeed is a positive belief. 

The glass-half empty trader will think, “I don’t KNOW I’ll be successful, but I’ll try my best.” The glass-half full trader visualizes their success every day. Regardless of their daily result. You will have losing...

Friday’s Blog Results: No short fill. The long level @ 4510 stopped out for a 3.50-point loss (per contract).  

Quick tip: Lose your edge?

Your trade strategies must have “edge,” otherwise you’re gambling and likely losing. The challenge is that edge is not always permanent. You need to be vigilant in your review process and notice when the edge may be fading or gone.

Our team has been relying on some edge that was validated by thousands of trade setups. This past weekend I updated the edge document to reflect current market conditions and some of those rules needed adjustments.

Strategies and trade plans can evolve. If you’re losing confidence in your strategy don’t assume it lost its edge. Research your results database. You might find, as we did, some minor changes to reflect a changing market will bring the edge right back. Learn more about trade plans and edge. Click here.

Today’s Best S&P Futures Turning Points:

Short...

Thursday’s Blog Results: Neither trade triggered but the buy @ 4534.75 did touch and bounce for 6-points at 3:59 PM ET, too late to enter.  

Quick Tip: Glad you disagree!

In Stephen Covey’s bestseller, “The 7 Habits of Highly Effective People”, the 6^th habit is Synergize. The concept of synergy is real and born in nature. You’ll need to read the chapter (the whole book would be better) to get all the details and proof. Just assume it’s true for now.

Think about this: If everyone you talked to agreed with you about the subject at hand, would there ever be any improvement to the subject (process, strategy, plan, etc.)? Nope. Case rested. We agree. Move on.

That is precisely why you should embrace disagreement… from a constructive viewpoint. Different opinions and outlooks, when approached properly can lead to dramatic improvements. It’s obvious. No one knows it all. Only by being open-minded and willing to understand a counter...