The Daily Market Forecast... Lesson Day

Monday’s Free Edition Results: The suggested buy @ 4344.75 ran for 26.50 points.

Today’s Lesson: When does the well run dry? In other words, how many times should you take the same trade?

Yesterday’s buy level was very strong. You earned 20+ points per contract in about 20 minutes on the first touch. Assuming you had a sensible exit strategy and didn’t give back the gain, you had a 2nd opportunity to enter. That ran for 15 points. Then a 3rd opportunity. 13.25 points.

This well had plenty of water in it. You could keep drinking. The real issue is what was the quality of the water?

That first touch was crystal clear ice-cold water. Very satisfying. Subsequent touches were good but not as clear and cold. 

Now, if you knew that over thousands of trades subsequent touches were less effective, would you bother to take them? Would you risk your winnings on a LOWER probability setup?

The trading team here knows it’s way better to move on to the next HIGH probability setup. Sure, you’ll miss winners but in aggregate you’ll be ahead.

For Tue 210921 (Plenty can change by the open, be aware.)

Globex Review: The late-day rally continued last night. The levels did very well offering one small winner and a 32-point level-to-level breakout before giving some back.

Day Session Analysis: Sentiment reverses to very BULLISH. STATS are mixed, trade either direction. Tuesday (both sessions combined garnered 20% of all the gains over the past 5 years in dollars. Reversals and Breakouts are about even.  Trading ES/CL/GC using BB Rev with new filters. STILL cautious with SPXW credit spread ladders.

S&P 500 Futures CPL: 4347.25/4355.50. We’re trading ABOVE the CPL (short edge below, long edge above) and ABOVE the equilibrium 4335.50/4351.50 (open below = short edge, open above = long edge).

The World Index: (+100/-100) SOARS from -93 to +57 with all major world markets very bullish EXCEPT Tokyo (short edge).

Catalysts: Housing Starts @ 8:30. FOMC starts. Evergrande near default, China expected to step in. Inflation worries worldwide.

Trends: 60 min UP starting to form a WEDGE, daily DOWN (short edge).

Chart: High outside day: Win/Stop% about the same, shorts delivered 20% more profit. Opening +0.90% (short edge). $TRIN XMA jumps to 1.13 leaning oversold now which means long term buyers are stepping in (long term outlook: stay long).

Globex: The range of 54.75 (possibly wider by the open) suggests a day session range around 66 points on a SOARING ATR of 53.02. Prior forecast around 78 points, actual 77.50.

Trade Well,

Mike Siewruk

P.S. For a free “mini-course” packed full of lessons on HOW to trade the Blog… Watch this video.