Still In ‘Trust Until Broken’ Mode
Before we get started, you may
have noticed a change in the column title over the weekend.Â
The main reason we’ve made the change is to keep the
column in line with the focus of my own trading which now includes more emphasis
on the E-Minis. As a result, we’ve also come full circle on our charts — if our
charter readers think back to when this column was launched over 17 months ago
— as we’ll be going back to posting charts for the S&P and Nasdaq E-Minis,
which will serve both futures and ETF traders. The patterns, setups and triggers
for both remain as taught in both the ETF and E-Mini courses.
With respect to today’s trading, both the S&P and Nasdaq remain in hourly
downtrends as we approach midday, which have — yes, yet again — capped climbs
on the lesser timeframes over the last two days. So I remain in my “trust until
broken mode” as we await continuation short triggers or reversals to the
upside. Until we break on the hourly, any longs on the lesser timeframes remain
scalps in respect of the 60. Given fairly tight consolidation on both 13s as we
approach midday, keep an eye on range breaks along with any emerging angles on
the 15MAs — especially on the S&Ps — which may provide clues for the afternoon
trade
ES (S&P)Â Â Â Â Â
Tuesday October 1, 2002Â 11:25 A.M. ETÂ Â Â Â Â Â NQ
(Nasdaq)
Moving Avg Legend:
5MA
15MA 60-Min 15MA
See
School and
Video for Setups and Methodologies
Charts ©
2002 Quote LLC
Many thanks to the TM
staff for putting up with me last Friday. It’s always fun trading live to
demonstrate that proper methods and approaches go far beyond the theoretical
world, an endeavor which I wish more in this industry would do in the spirit of
providing substance behind words in a field where far too many smoke and mirrors
exist. Believe in your approach strongly enough to trade live in front of others
and expose the good, bad, and ugly? Great, I’ll pay close attention. Perhaps
those WSJ reporters Larry mentioned in his weekend piece would also do
well to step in the real world from time to time.
In many ways, the day effectively epitomized real-life E-Mini trading as the
market provided a number of opportunities to deal with both planned and
unplanned events as we traded trends, reversals, scaled in, scaled out, took
initial and trailing stops, and even recovered from an order entry error (it’s
real life folks!). When all was said and done, we were both gross and net
profitable with five profitable trades and one initial stop — two if you
include the order entry correction. I’ll be sharing more about the session
shortly.
From the growing E-Mini Mailbag
Hi Don!
I’m not usually much of a letter writer and I’m probably the world’s biggest
skeptic when it comes to all the hype regarding trading systems. Admittedly I
struggled over purchasing your E-Mini trading system but
I’m glad I finally made the purchase.
I have been trying to make a go with trading the E-Mini S&P for about a year and
have very little success. I’ve read dozens of books and have done all the
normal things a new person to trading usually does by
attending seminars etc. Looking back, I’ve probably done myself more harm than
good.Â
My real trading account has taken quite a beating this past year as I’ve lacked
the understanding and discipline to do myself much good. Over the past 2
trading days however, by using your approach I have made $8,800 using the
real-time simulator with PFG. I’ve traded 10 mini contracts (equivalent to 2
full size) at a time and have scaled out half of the position per your rules and
let the remainder run after entering a stop loss to nearly breakeven in each
case. My final exit was again per your rules.
I know what you’re thinking, “real trading and paper trading are total
different”. You might already know that PFG’s simulated trading is exactly the
same as actual trading in the way fills are handled, it’s just not linked to a
real money trading account. I didn’t fudge or fake my way using the simulator,
I traded the way your course teaches.
Your system allows a person to trade in a much more relaxed manner and with a
new perspective on the market. Thank you.
K.M.
Good Trading.
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