Why “13” Is The Number To Watch

It’s been a pretty lame
trading morning thus far as the major markets are torn between strong daily
downtrends and 13-minute uptrends,

resulting in a very light and choppy trade with limited follow through in either
direction. And as was the case on Friday (more on that below), respecting the 13
has been the ticket to staying on the right side of the intraday trade thus far
this morning. Given the conflicting time frames which result in a very difficult
reward/risk ratio, traders may want to stay on the sidelines until higher
percentage opportunities present themselves. As we go to press, ES is pulling
back to its 13 support which may provide an initial pullback opportunity, yet
traders will want to keep an eye on momentum indicators should we bounce given
the longer-term charts.

Friday’s ES trade was interesting, in that while the daily and hourly charts may
have favored looking for short triggers, the strength and increasing angle
(post-column) of the 13-minute support provided a clear signal to reinforce our
ongoing “Respect until Broken” mantra. As it turned out, the 13 support held all
day until the fourth pullback, at which point the ultimate break
triggered a five-point plummet. Was I surprised at the midday strength of the
13? Perhaps, yet our rules still provided strong guidance, and even if one
didn’t trade the morning or early afternoon 13-minute pullbacks from the long
side, there was still one good short on the ultimate break. Based on the size of
the bars and trade pace on that final break, the combination of long stops and
fresh shorts combined to create a nice final short profit to end the week.

Lastly, as Larry Connors mentioned in his

weekend piece
, we’re currently making plans for a weeklong trading seminar
for the first week in March using state-of-the-art audio and visual conferencing
technology. As Larry knows, this is something I’ve given serious thought over
the last few months as the result of feedback and requests from students of my
instructional material and current mentor program. Specifically, folks have
indicated they appreciated the live trading segment of the video, yet given the
delivery mechanism, we were, of course, limited to one day’s worth of trading
during the taping, and thus a single market pace, and we also didn’t have live
trader interaction.

Up to now, I’ve held off doing it until I felt I could put 150% of my effort
into it. If you know me by now, I want to ensure quality with anything I do from
a teaching perspective — especially when folks are paying — or else it’s
simply not worth doing, period. The effort has also taken some additional
planning than normal because I wanted to approach such an effort — to borrow at
term from the medical industry — from a comprehensive “holistic”
perspective. What I mean by that is while we’ll spend a good part of the time
monitoring the markets, discussing and scanning for technical setups, and doing
trade demonstrations, we’ll also use midday seminars and evening roundtables to
discuss the other equally, if not more important aspects of trading, including
psychological hurdles and stress reduction, along with simply having some
informal Q&A time. Simply put, as is the case with my attitude toward medical
issues, I believe in trying to attack the foundation and root of this business
versus addressing a few symptoms.

Anyway, I’m very excited about doing this and we’re currently fine-tuning the
detailed agenda which will be available shortly. The entire effort will be
delivered via a continual live audio and text feed and screen captures, so you
can participate from the comfort of your own home or office without incurring a
penny of travel costs. As Larry indicated, we’ll be limiting participation to
only 20 folks to ensure quality time and productive interaction. The cost
will be $2,500, which will include more than 40 hours of productive time
together, including the evening roundtables. If you’d like to reserve a spot,
please contact Brice Wightman at 888.484.8220, x242.

ES (S&P)       
 
Monday  February 3,
2003  11:13 A.M. ET           
NQ
(Nasdaq)

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

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Good Trading!

Don Miller