Trade Aptitude

Results of Tuesday’s Best S&P Turning Points: The buy @ 3963.00 stopped out. 

Today’s Best S&P Turning Points (consider wider stops and less size in fast moving markets): 

Short 4002.25 stop 4006.50. Buy 3922.50 stop 3917.75.  

Globex View: Inside, narrow range trending down. Looking for price to melt down again today but mindful that a relief rally is just as likely. 

The World Sentiment Index: (+100/-100) DUMPS from -14 to -57 with all major world markets bearish. Historically price closes LOWER than the open 56% of the time.   

Catalysts: Productivity & Costs @ 8:30. EIA Petroleum Status Report @ 10:30. Gloomy 2023 predictions from big Wall Street CEOs. 

Quick Tip: Confluence with $TICK

Regardless of your day trading strategy ruleset, you’ll benefit from confluence with other information for both entries and exits. We trade several strategies in our trading room, and they sometimes confirm a directional bias to enter. They also suggest good exits when suggesting a change in direction. 

Market Internals, particularly the $TICK index, is a great day trading tool. From Investopedia: “The index measures stocks making an uptick and subtracts stocks making a downtick. For example, there are roughly 2,800 stocks listed on the NYSE. If 1,800 stocks have made an uptick and 1,000 stocks have made a downtick, the tick index would equal +800 (1,800 – 1,000).”

Mostly it’s just a noisy, fast-moving display that offers little help. But when the $TICK reaches +1000 or -1000 it signals overbought and oversold conditions. We’re not suggesting using those values as entries on a standalone basis, but as confluence with your current strategy they’re helpful for both entries and exits. 

Add a 1-minute $TICK chart to your platform and keep track of how price reacts to the extreme values. Notice in the chart that yesterday’s $TICK was persistently below ZERO on a down trending day, until the rally near the close. It also signaled a few turning points higher. 

Documenting this data will be helpful in determining whether it’s an indicator you should add to your toolbox. 

Trade Fearlessly,

Mike Siewruk 

P.S. Feel free to share this blog with all your trading buddies.