If the S&P hits this level today..sell

Stock index futures were more directional
in nature than we’ve seen for a bit lately.
That said, it was still a
modest range day on rather normal volume. Most of the September index option
contracts cease trading tonight and settle off tomorrow’s average opening value.
That tends to skew expiry Thursday’s index action a bit, but not always. Could
be an eventful day ahead… and here are some overall points of reference to

ES (+$50 per index point)

S&P 500 has (at least) three visible swings
from the past three sessions. Laying retracement grids on each shows 1238 as
triple resistance and 1241 ~ 1242.50 a dual zone of upper resistance as well.
With this in mind, sell signals near these zones are high-odds entries to

Overall, the past four complete sessions have
seen a 16pt total decline in the S&P. That is nothing to get excited about, and
certainly not extended to the downside. Further selling is possible, path of
least resistance appears to be lower.

MD (+$100 per index point)

S&P 400 has initial resistance near 719 and dual
layers of resistance near the 720.50 level. Total range for the MD was 6+ points
or $600+ per contract. Not a big session by any stretch, but tradable.

YM (+$5 per index point)

Dow Industrial futures face initial
resistance near 10615 and heavier layers near 10630. Yesterday’s sell signal
near 10670 was good for +$450 per contract if held to the lows, or some measure
of profit in between if closed early. Today could be equally prosperous if not
more so.

ER (+$100 per index point)

Russell 2000 futures have mapped the
steepest decline of any stock index recently. Hot money flies in, hot money
pours out accordingly. First resistance is 673.80 followed by 676 area of
layered overhead. Sell signals near these zones of clustered congestion are
high-odds to work.

{Price levels posted in charts above are
compiled from a number of different measurements. Over the course of time we
will see these varying levels magnetize = repel price action consistently}

Power Of Thought

“By your words (thoughts) are ye justified, and by your words
(thoughts) are ye condemned.”

I can almost always tell when a person is going
to succeed or fail at any endeavor in life purely from what they expect.
Positive expectations matched with perfect practice equals eventual success.
Negative expectations matched with half-baked, slipshod practice habits leads to
inevitable failure.

Thoughts and actions necessary to succeed
inside any endeavor are
no more difficult than thoughts and actions necessary to fail. Why do so many
traders choose to walk the losing path thru our profession?

Impossible Odds?

There are thirty-two teams of professional football players in the National
Football League. One of those teams will win the SuperBowl championship prize
for this season’s long, grueling process.

The odds of any single team winning at random
are 3.1% out of 100%.

Literally thousands of college players each
year vie for a spot on each team’s roster, with random odds of success being
considerably less than 3.1% in favor.

Time, effort, study and individual sacrifice
made on so many levels to first reach the NFL as a player and then win a
championship are astounding and infinitesimal in my mind. What it must take from
start to finish thru literally years and usually decades of focus and
goal-setting is (in my opinion) far beyond that of succeeding as a profitable

Where would any of those players be if they
began playing Pop Warner, high school or college ball with the following
internal dialogues?

“I’m so busy with college work, I don’t have
time to study the playbook”

“Every time I try to catch the ball, I drop it. Stupid Quarterback throws

“Every time I try to tackle someone, they run the other way. The game is out to
get me”

“Playing in the NFL is just too hard. I don’t have the patience to learn &

“The majority of players who try will fail. It is a sucker’s bet to even dare

“I’ve played soccer for years. Just give me NFL basics and I’m ready to turn pro

“I need to play NFL football right now… I just quit my job to go full-time”

“I don’t have time to learn… must make money as an NFL player from day one”

“There must be some secret formula = system that will teach me how to play from
day one”

“I need a system that shows me where to run, catch the ball or tackle correctly
every time”

“I can just join a team, follow the head coach and earn while I learn.
Meanwhile, I can workout and lift weights to grow from present 6’2″ and 160lbs
to a full-size running back’s condition. I’ve never lifted weights or run wind
sprints before… but how hard can that be?”

Get What You Expect

Replace the inner dialogues that float thru most football player’s minds
listed above with a slight change in wording, and you have the exact-same
affirmations of failure for aspiring traders.

It is widely touted that most traders fail to
make money and wash out of our profession. Yeah, and what else is new? How many
aspiring athletes achieve pro status? How many aspiring actors / actresses
support themselves full-time? How many communications majors in college secure
news anchor or investigative reporter roles? How many vice presidents of
corporations ever reach C.E.O. status? What profession, especially a high-paying
one does have an easy barrier of entry to success? None that I can think of.

Just because anyone can fund an account and
call themselves a trader does not mean they have reached step one in the
necessary training curve. Any walk-on in college can call himself a football
player… surviving the practice sessions to reach live game action is another

Along the way in life, our own mind is the
point of make or break for success and failure alike. We know that the power of
positive thinking is paramount for success. You would not want to root for any
athlete or professional team that expects to lose. You would not want your
spouse, child or anyone you love to walk around planning their own failure by
repeating negative thoughts to themselves.

Why then do so many of us persist in thinking =
speaking negatively? We’ll continue our discussion on Friday.

Trade To Win

Austin P


(free pivot point calculator, much more inside)

Austin Passamonte is a full-time
professional trader who specializes in E-mini stock index futures, equity
options and commodity markets.

Mr. Passamonte’s trading approach uses proprietary chart patterns found on an
intraday basis. Austin trades privately in the Finger Lakes region of New York.