Bias Toward Low-Risk Pullbacks

• August 12, 2002
• Don Miller

Opportunities
have been rather limited thus far this morning,
as many players seem to be on the sidelines awaiting
tomorrow’s FOMC meeting. Frankly, both of my coast-to-coast flights over the
weekend had more bumps than today’s price action, and the flights were pretty
darn smooth. 

Given the morning Q and SPY 13-minute downtrends, I’ve had a bias toward
low-risk pullbacks, yet thus far the pace and follow-through beyond the morning
gap has been lacking. As I mentioned at the Expo on Friday, given the weak
hourly and 13-minute closes and price/momentum divergences upon the Friday
close, any break of Friday’s 13-minute support would have been an acceptable
early short trigger. 

Unfortunately for intraday traders, the trigger occurred overnight so we may be
looking at limited opportunity for today. Having said that, my bias remains with
the 13-minute trend until violated.

QQQ         
Monday  August 12, 2002  12:20 P.M. ET           SPY

Moving Avg Legend:
5MA
15MA 60-Min 15MA

See
School and

Video for Setups and Methodologies

We had a great time
at the Online Trading Expo over the weekend and it was great to see many of you
there. The QQQ/SPY seminar had a strong turnout as interest in trading indices
over individual equities continues to grow, whether it be Exchange Traded Funds
(ETFs) or E-Minis. 

And speaking of the E-Minis, based on the Expo conversations and E-mails, more
folks are discovering that the QQQ/SPY strategies are 100% transferable to the
E-minis and other highly-liquid markets. Remember our ETF setups and triggers
come right off the E-Mini charts, so
it’s a natural transfer and premise for expanding the School to include the
E-Minis. I also learned at the Expo that one trader has even successfully
applied the Q methodology to soybeans and is doing very well!

Good Trading!

Don Miller