Wednesday’s Results: Trading was suspended for FOMC volatility.  

Quick Tip: Simple Not Easy

You’ve probably heard the phrase “trading is simple, it’s just not easy.” Indeed, trade plans can be simple to execute but because of our thoughts, emotions, and behaviors we make it hard to follow thus missing the result we want.

Let’s say your “simple” trade rules were based on 1) Determine the big picture trend, 2) Sell rallies in a downtrend on a shorter time interval, 3) Buy dips in an uptrend on a shorter time interval. This is not only simple, but it makes sense. Price moves in waves of impulses and corrections within a trend.

The stock market is in a big picture downtrend. You should have sold yesterday’s rally on the FOMC news. Had you done that you’d be looking at a huge winner as the market is opening down today around 2%! If you didn’t follow your rules, if you didn’t make it “easy,” it was...

Tuesday’s Results: The buy at 3713.75 caught the bottom of the day running 39.75 points before closing the session +26.25.

Quick Tip: FOMC Evidence: S&P

Everyone knows the pattern on FOMC day tends to be range-bound before the announcement and spiky afterward. This should help your trade selection and planning. In fact, if you have solid historical data on your strategy’s performance on FOMC day you might not trade at all. It’s always better to have some probabilities at hand. Keep accurate records whether you took the trades or not.

The announcement releases at 2PM ET. You might think the highest volatility is within the 30-minute interval afterward. Historically, it’s the next 30-minute interval (see second chart).

Direction and move for both intervals: 64% UP, 36% DOWN.

The move widens consistently during the second interval: +29 to +33 points and -17 to -24 points.

Are there any actionable rules you can apply? Maybe so, maybe not. But it’s worth...

Monday’s Results: The buy at 3779.50 stopped out for a 4.25-point loss (per contract).

Quick Tip: Sweet Dreams

The futures market opens at 6:00 PM ET. It’s called the Globex session and it is easier money than the day session. Why? The participants are different. Day session volume brings out all the large lot and algo traders and that creates a noisy effect on price action.

If you’re thinking “I don’t have the time to analyze the market and KNOW where to place those Globex trades” then you’re in luck. We provide our members a complete trading plan for the Globex session every market day around 5:15 PM ET, that’s 45 minutes before the open.

The chart above shows the trade plan levels for last night’s Globex. Five trades, three winners. Decent moves. Join me on Sunday, June 19 @ 5PM ET for my new FREE mini-class “Day Trading for Day Workers.” Click here to register.

Today’s Best S&P Turning Points: 

Sell...

Thursday’s Results: Buying 4416.25 failed the reversal pre-market and failed the breakout during the day session.   

Quick Tip: Night School Rocks!

With distance learning common today night school might be losing popularity.

But NOT in the futures, Forex, and crypto markets. These assets trade all night long. You should be planning trades for what is called the Globex (night) session in the futures market. Set and forget while you sleep.

What is equally important about the Globex session is the clues and edge it can give your Day session trading. You should study the Globex data on assets you trade. Patterns and edge will emerge. It may change from time to time so keep your research updated.

Here’s an example: The S&P futures is modestly active in the Globex. The volume is a small fraction of the day session, but enough to analyze. Measure the range of the session (from 6PM to 9:30AM ET). This is a great way to forecast the range of the day session....

Wednesday’s Results: Shorting 4158 offered 52.75 points before closing the day +43 points. 

Quick Tip: Courage or Confidence?

You’ve probably experienced that trade setup that just didn’t look or feel right. The rules say “Short” but price is skyrocketing. All you can think about is that stop getting filled instantly and you’re underwater again. Sound familiar?

On the chart above, notice the momentum leading into the suggested short level. The parabolic move up came within ONE TICK of filling your short entry.

Taking that short against that momentum felt wrong. But it wasn’t. Hard evidence over thousands of trades showed the probability was in your favor.

Would it take “courage” to enter that trade? Being courageous sounds too risky to me. I get mental images of danger ahead and I’m supposed to plow right through and prevail… without pain?

Then it retraced several points. Relief! That level may work out!

...

Tuesday’s Results: The suggested short stopped out.

Quick Tip: Learn to Reframe

Yesterday’s short trade @ 4133.50 stopped out by one tick! Price then plummeted 25+ points. Instead of a solid payday you paid out. Are you upset? Critical? Sad?

Having a positive attitude about your trading is important. Banish those negative thoughts and blame. Reframe the results of a trade like this one to the positive.

Here’s how: Ask yourself, overall did the short level work out? Did the trade run plenty? Was it a great short entry? Yes, yes, yes.

The fact that you missed the run by a small margin doesn’t negate a well-planned trade. Instead of fostering negative emotions about this result focus on the positive. Learn from the failure. What could you do differently the next time? Widen your stops, reduce size if needed. Or accept “subsequent-touch” entries. In this case it worked well.

That’s how a successful trader turns today’s loser into...

Monday’s Results: Neither suggested level triggered.

Quick Tip: Nifty Evidence

Filtering your trade entries/exits by time-of-day is a great way to optimize your trade selection. The side benefit is that you know when you’ll be trading and when you can focus on other things.

How you look at the data is the key. By imagining different ways to look at “time” you can find uncommon edge.

Here’s a great example: In the histograms above every bar is 30 minutes starting at 8:30 ET and ending at 16:00 ET. The bars represent the average range of that 30-minute time slot in DOLLARS.

Why dollars? Because futures contracts have different “point” values. The ES contract is $50/point. Oil is $1000/point. Gold is $100/point. To compare them you can normalize the ranges to their equivalent dollar values.

By looking at time-of-day this way you can laser-focus your trade entries for each asset to when the most movement is likely to occur. Study those three...

Friday’s Results: Neither suggested level triggered.

Quick Tip: Think like a CEO.

You should manage your trading like a business. Even if you’re employed, think of it as a side business. You’re unlikely to have employees and that means you need to wear different “hats” to be successful. At times you will need to act the roles of CEO, CFO, and Trader.

The CEO creates the vision then ensures it becomes a reality. You are the author of the trading plan, documentation, and review processes. You are not mired in day-to-day performance. Your focus is on long term growth and goal attainment. Spend some time developing a written vision statement and goals (within your trade plan). Read them frequently when you’re wearing your CEO “hat” and especially when you’re facing performance challenges. This is great work to perform on the weekend, free from distraction of your other “hats.”

The CFO manages the money. Profits and...

Thursday’s Results: Neither suggested trade triggered.

Quick Tip: Optimizing Credit Spreads

Same-day expiration SPX credit spreads are extremely popular trades for income generation. Recently the CBOE has added Tuesday and Thursday expiration contracts proving the popularity of the trade. Now you can trade a different strategy for income 5 days a week.

If you’re not familiar with the trade here’s a brief explanation: You select a price level on the chart that you believe price will NOT touch/exceed today. For the Bear Call spread that level would be way above current price. For the Bull Put spread that level would be way below current price.

The trade is entered by selling a call/put for a credit and buying a protective call/put for a debit. You will net the difference. Your maximum risk on the trade is the difference between the strikes less what you were credited on the spread.

That’s a mouthful so let’s look at the numbers. A typical net credit may...

Wednesday’s Results: Neither suggested trade triggered.

Quick Tip: Get Another Strategy

For the past two days neither of the best volumes levels offered here triggered. Patience required for sure. The alternative is to trade more than one strategy. The key is to find a strategy that is complementary, not competitive with the others in your toolbox.

Two popular styles to combine are breakout/reversal and trend following. Price is always in one of the two conditions: range-bound or trending. With practice you’ll hone your skill in choosing which to employ.

Yesterday’s chart of our new trend following strategy enjoyed the move down while our reversal strategy was waiting for the 4063.65 level suggested that never arrived.

Tuesday’s Results: Today’s Best S&P Turning Points (same as yesterday):

Sell 4292.50 stop 4297.50. 

Buy 4063.75 stop 4058.00.

Trade Fearlessly,

Mike Siewruk

P.S. Did you know there are specific tools and formulas you can use to...