The Daily Market Forecast... Power in Confluence

Friday’s Results: Neither suggested level triggered.

Quick Tip: Power in confluence.

You have a trade plan with specific rules of entry and exit that produce a positive expectation (if not, get one or quit trading). If EVERY trader used the same plan and followed it precisely there would be no one to trade against.

You WANT and NEED traders to do something different than you. This is a good thing. Now if you want to step up your performance you’ll learn OTHER popular trading strategies. Not necessarily to trade them, but to consider what OTHERS may be doing at the same time.

Here's a simple example: the 20-period moving average is a popular technical indicator. You may not use it because it is a lagging indicator or you haven’t been taught HOW to make it work. Regardless, there are traders who use it. Put it on your chart.

Why? Because if your strategy is getting a signal to enter around there you might be finding some confluence (with other trade plans). If you’re short in the trade and wondering about a good profit target, approaching that indicator, where others might be buying, would be a fine exit.

I’m not suggesting you clutter up your charts with every indicator or trendline or fib, etc. I’m suggesting that KNOWING how others trade these and considering their potential effect on your plan could be helpful.

Today’s Best S&P Turning Points:

Sell 4088.25 stop 4093.00.

Buy 3903.75 stop 3898.00.

Trade Fearlessly,

Mike Siewruk

P.S. What’s more important in trading? Math or emotions? Learn how to change your unwanted behavior here.