Confirming Trend by Trade Aptitude

Yesterday’s results: No trades suggested. 

Today’s Best S&P Futures Turning Points: Buy 5936.25 stop 5931.25. Short 5932.00 stop 5937.00 if price retraces back from below (filtered out during FOMC volatility). 

The World Index: (+100/-100) eases up from +36 to +50 with most major world markets Bullish. J

Catalysts: Jobless Claims & Preliminary NFP @ 8:30. Wholesale Inventories @ 10:00. FOMC Statement @ 14:00, Press Conference @ 14:30. 

Quick Tip: Confirming Trend

If you trade a trend strategy you know that the biggest challenge is filtering out the whipsaw, range-bound conditions. Arguably the king of using Wilders’s RSI indicator for trend identification was the late Andrew Cardwell. 

His quote applies to all trading but especially for trend trades: “You do not have to make a lot of trades you just need to make a few good trades.”

Cardwell introduced the concept of “Range Shift” using RSI to determine bullish versus bearish conditions. Basically, RSI ranges from 40 to 80 during bullish phases, and 20 to 60 during bearish phases. 

An example of application would be to buy or add on when the bullish phase retraces down to 40 and short or add on when the bearish phase retraces up to 60. I’ll be monitoring this concept with our trend strategy and report back findings in the future. Give it a try yourself. 

Our trading teams focus on multiple strategies for day trading futures and high-probability candidates for swing trading options. Maybe you'll fit right in. You can try either or both risk-free.

Trade Fearlessly,

Mike Siewruk

P.S.  Feel free to pass this along to your trading buddies. Share in the wealth!

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