Tuning Your Watch List by Trade Aptitude
Yesterday’s results: : No trades triggered.
Today’s Best S&P Futures Turning Points: Buy 5936.25 stop 5931.25. Short 6002.75 stop 6007.75.
The World Index: (+100/-100) drops from -7 to -21 with all major world markets neutral to Bearish on low volatility.
Catalysts: Retail Sales, Empire State MFG Index, Import Prices @ 8:30. Fed’s Collins @ 9:00, Williams @ 13:15. Industrial Production @ 9:15. Business Inventories @ 10:00.
Quick Tip: Tuning Your Watch List
Stock and option traders have a challenge that futures and Forex traders don’t have. How to winnow down your trading candidates from nearly 9000 stocks.
There are some common filters that are easy to implement like price and volume. Picking stocks that are between $10 and $50 reduces the selection to 2200. Add in average volume over 1 million daily and you’re down to 562.
You can keep adding filters to get to a manageable number,...
Trading in the 5th Dimension by Trade Aptitude
Yesterday’s results: Buying 5996.50 stopped out. Shorting the retracement to 5993.50 offered a 6.75-point scalp.
Today’s Best S&P Futures Turning Points: Short 6032.75 stop 6037.75. Buy 6037.50 stop 6034.75 if price retraces down from above (filtered out during CPI release).
The World Index: (+100/-100) soars from -71 to zero with the major world markets mixed on falling volatility.
Catalysts: CPI @ 8:30. FOMC speakers; Kashkari @ 8:30, Logan @ 9:45, Musalem @ 13:00, Schmid @ 13:30. Federal Budget Balance @ 14:00.
Quick Tip: Trading in the 5th Dimension
You could argue that chart trading is 3-dimensional. You’re analyzing price, volume, and time on a chart.
If you add fundamental analysis to your plan that would be your 4th dimension, and it would very likely improve your performance. Knowing more about the assets, sectors, and economy can only help you.
There is a...
Windfalls by Trade Aptitude
Yesterday’s results: No trades triggered.
Today’s Best S&P Futures Turning Points: Buy 5996.50 stop 5992.75. Short 5993.50 stop 5997.25 if price retraces up from below.
The World Index: (+100/-100) soars from -50 to +36 with most major world markets Bullish.
Catalysts: Nothing on the economic calendar.
Quick Tip: Windfalls
Not nearly enough, but on occasion your trade becomes a windfall. Not so much in day trading but swing and position trading for sure. Maybe you bought NVDA 2 years ago and held on. Windfall!
Our swing trading team experienced a remarkable windfall trade last week. The strategy we used had to do with Unusual Options Activity. Simply put, these are huge bets on unlikely outcomes. The concept is that anyone who can bet that big must know some non-public information.
Following the chart above you’ll see we uncovered a Smart Money bet on 10/21. $2.1M was bet on this $160...
Time Horizon by Trade Aptitude
Yesterday’s results: Buying 5789.50 stopped out. The short idea didn’t trigger.
Today’s Best S&P Futures Turning Points: Buy 5705.75 stop 5699.00. Short 5696.50 stop 5702.25 if price retraces up from below.
The World Index: (+100/-100) jumps from -43 to +21 with most major world markets Bullish on relatively low volatility.
Catalysts: Non-Farm Payrolls @ 8:30. S&P MFG PMI Final @ 9:45. ISM MFG PMI @ 10:00.
Quick Tip: Time Horizon
Establishing the time horizon for your trades is critical. You’re committing capital, which is limited, to get a result. Deciding on the win or loss amount is not enough. You should have a “time” stop as well to free up the capital for another opportunity.
Here’s an example:
Our swing trading strategy for equities and options utilizes a key catalyst for stock selection: Large Insider buying. Why? Because Insiders know best about...
Insider Influence by Trade Aptitude
Yesterday’s results: Buying 5847.75 stopped out. Shorting 5891.00 filled in the Globex @ 20:42 ET and ran for 15+ points, still open.
Today’s Best S&P Futures Turning Points: Buy 5908.75 stop 5903.75 if price retraces down from above. Short 5865.00 stop 5869.75 if price retraces up from below.
The World Index: (+100/-100) plummets from +21 to -43 with most major world markets Bearish on rising volatility.
Catalysts: ADP Payrolls @ 8:15. GDP @ 8:30. Pending Home Sales @ 10:00. Crude Oil Inventories @ 10:30. GOOG revenue/earnings beat gives AI a boost.
Quick Tip: Insider Influence
Your trading toolbox probably includes tools for the analysis of technical, fundamental, and sentiment data. All good.
Significant research by Wall Street and academia has proven that Insider buying is predictive of positive abnormal future stock price performance. Of course, when that abnormal positive move happens varies widely...
Alpha Searching by Trade Aptitude
Friday’s results: Buying 5851.50 was only good for a 4.25-point scalp. The short idea didn’t trigger.
Today’s Best S&P Futures Turning Points: Buy 5847.75 stop 5842.25. Short 5904.50 stop 5909.50.
The World Index: (+100/-100) rises from +14 to +36 with all major world markets neutral to mildly Bullish on low volatility.
Catalysts: Dallas Fed MFG Index @ 10:30.
Quick Tip: Alpha Searching
Our day trading team meets every morning between 9:00 and 10:30 AM ET to swap ideas on trades across several strategies. Some days are very active, others quiet. Lately it seems the market has chopped sideways during our sessions and made the better moves later in the day.
As the host it’s challenging to find commentary when setups aren’t setting up!
For those that also swing trade options, there is plenty to talk about. Our swing trading team only meets once weekly but when you’re running a portfolio...
Short Interest by Trade Aptitude
Yesterday’s results: The suggested trade didn’t trigger.
Today’s Best S&P Futures Turning Points: Buy 5908.75 stop 5903.75 if price retraces back from above. Short 5869.00 stop 5873.00 if price retraces back from below.
The World Index: (+100/-100) eases from -29 to -14 with most of the world mildly Bearish on lower volatility.
Catalysts: Fed’s Bowman @ 9:00, Barkin @ 12:00. Existing Home Sales @ 10:00. Crude Oil Inventories @ 10:30. Fed’s Beige Book @ 14:00. TSLA earnings after the close.
Quick Tip: Short Interest
Short interest is a great “off-the-price-chart” indicator you can add to your research for stock and option trades. It’s the number of shares of a particular stock that have been sold short but have not yet been bought back (closed).
If short interest is high, it suggests bearish sentiment and an unusually low short interest suggests bullish...
Easy Options by Trade Aptitude
Yesterday’s results: Neither trade idea triggered.
Today’s Best S&P Futures Turning Points: Buy 5888.50 stop 5884.50. Short 5885.25 stop 5889.25 if price retraces from below.
The World Index: (+100/-100) jumps from -36 to zero with mixed sentiment, the east is Bearish, the west is Bullish on increasing volatility.
Catalysts: Retail Sales, Jobless Claims, Philly Fed MFG Index @ 8:30. Industrial Production @ 9:15. Business Inventories, Housing Market Index @ 10:00. Crude Oil Inventories @ 11:00. Fed’s Goolsbee @ 11:00. Janet Yellen (tentative).
Quick Tip: Easy Options
Having a small account shouldn’t prevent you from swing trading stocks. Your solution is to substitute options. With over 700 stocks that have liquid options you have an abundance of choice.
Plenty of new traders shy away from options. Their perception is they’re complex and hard to learn. They can be complex, and they can be...
Invisible Demand by Trade Aptitude
Yesterday’s results: Buying 5861.25 offered a 4-point scalp. Shorting 5859.00 offered a 6.75-point scalp.
Today’s Best S&P Futures Turning Points: Buy 5823.25 stop 5820.00. Short 5908.50 stop 5912.25.
The World Index: (+100/-100) slides from -29 to -36 with most major world markets Bearish on modest volatility.
Catalysts: Import/Export Prices @ 8:30. Earnings continue (individual stocks can have a big market impact, consider ASML/NVDA yesterday).
Quick Tip: Invisible Demand
All markets are influenced by the forces of supply and demand. More demand than supply will push the markets higher. This natural law works on every tradable asset.
But is all demand visible on a price chart? For indexes, currencies, and commodities, I would argue yes. They are mostly institutional markets, and the footprints large traders leave can be found. Our team trades a chart-based Supply/Demand strategy that has a real...
Trade Aptitude
Yesterday’s results: No trades triggered.
Today’s Best S&P Futures Turning Points: Buy 5789.50 stop 5786.25. Short 5787.00 stop 5790.25 if price retraces back up from below (filtered out during CPI release).
The World Index: (+100/-100) rises from zero to +21 with sentiment mixed with Asia somewhat volatile, not so much the west.
Catalysts: CPI & Jobless Claims @ 8:30. Fed’s Cook @ 9:15, Barkin @ 10:30, Williams @ 11:00. 30-Year Bond Auction @ 13:00.
Quick Tip: Multi-Strat
Yesterday’s price action did not trigger any trades in the S&P futures for two of our strategies, Volume Profile and Volatility Reversal. Plenty of patience is required when day trading and not getting a quality setup.
Fortunately, we also trade an intraday Trend/Momentum strategy that ran for 38.25 points (see chart above). It’s not uncommon for the strategies to diverge....