Yesterday’s results: No trade triggered. 

Today’s Best S&P Futures Turning Points: Nothing tradeable today. 

The World Index: (+100/-100) soars from +8 to +93 with all major world markets very Bullish. Contrarian alert (there will be profit taking, maybe today). 

Catalysts: Jobless Claims & Philly Fed MFG Index @ 8:30. Existing Home Sales @ 10:00. 

Quick Tip: Herd Following

Trend following as a trading strategy is effective and popular among hedge funds. But they don’t all use the same algorithm. They want to be different enough to compete for better returns and the new money to manage that will come pouring in. 

With AI gaining popularity in the trading world, you can imagine that one day there might be no one to trade against. As AI matures, everyone will have access to “all knowledge.” Why wouldn’t everyone use the best rule set? 

This is an interesting challenge that is on the mind of Gary Gensler, head of the SEC. In a Bloomberg article he warned that with AI “too many brok...

Yesterday’s results: Buying 5698 stopped out. 

Today’s Best S&P Futures Turning Points: Buy 5630.00 stop 5626.25 (filtered out during FOMC release between 14:00 and 15:00). No short suggestion. 

The World Index: (+100/-100) drops from +33 to +8 with sentiment mixed. Waiting on FOMC. 

Catalysts: Building Permits & Housing Starts @ 8:30. Crude Oil Inventories @ 10:30. FOMC Rate Decision @ 14:00, press conference @ 14:30. 

Quick Tip: Don’t Retire

You’ve probably heard or read the best ways to have a long and fulfilling retirement: Exercise regularly, sleep more, eat healthy, drink moderately, stop smoking, and minimize stress. 

Here’s one thing you might not have heard about: Connect with people who have the same purpose. It turns out that loneliness is a killer. 

Living in Florida I’m frequently asked when out socially if I’m retired. I’m not and never will be, in the classic sense. Why? To keep my mind sharp. Learning and reading are great, but nothing beats interaction with peop...

Yesterday’s results: No price levels available due to contract rollover. 

Today’s Best S&P Futures Turning Points: Buy 5698.00 stop 5693.25. No short levels above. 

The World Index: (+100/-100) jumps from zero to +33 with most major world markets Bullish on rising volatility. 

Catalysts: Retail Sales @ 8:30. Industrial Production @ 9:15. Business Inventories, Housing Market Index & Fed’s Logan @ 10:00.

Quick Tip: Complacent?  

We all trade to win and make a profit. The ups and downs happen along the way. The time to get laser-focused is when you’re feeling like you don’t need to. 

The recent rally in the S&P has the stock indexes at or near all-time highs. Our team’s swing trading portfolio had some incredible gains last week. One trade earned over 700% in two days. It’s natural when everything is effortlessly going your way to relax and enjoy the ride. 

But complacency is a dangerous condition. It precedes fear. You’ve likely heard Buffett’s famous quote “We try to be greedy wh...

Yesterday’s results: Neither trade idea triggered. 

Today’s Best S&P Futures Turning Points: No price levels today due to contract rollover. 

The World Index: (+100/-100) drops from +21 to zero with sentiment mixed and volatility very low. 

Catalysts: Empire State MFG Index @ 8:30. 

Quick Tip: Futures Rollover

Futures contracts are buy/sell agreements between two parties. Every contract has a delivery date at which point the transaction ends and goods/money are exchanged. 

Many futures traders have no intention of fulfilling their contractual obligations. They’re either speculating on price direction or hedging against price changes. For these traders exiting the current contract before the delivery date and entering the next contract further out on the calendar is called rollover. 

For stock index futures the rollover is quarterly near the middle of March, June, September and December. The symbols will change to H, M, U, Z respectively. Starting today we’ll be trading the Decem...

Yesterday’s results: Neither trade idea triggered. 

Today’s Best S&P Futures Turning Points: Buy 5569.75 stop 5564.00. Short 5688.25 stop 5693.50.

The World Index: (+100/-100) drops from +57 to +21 with most major world markets mildly Bullish on declining volatility. 

Catalysts: Import Prices@ 8:30. UofM Consumer Sentiment @ 10:00. 

Quick Tip: More Price Levels

This blog suggests two good setups every day. One long, one short. They are not the only setups that are presented from the volume-at-price analysis. 

Every trading day offers a different “map” of volume levels. They only work for so long, then they’re taken off the chart. That happens when the level is stopped out. 

Hint: Save the levels that didn’t trigger a trade or stop out. They’re good until they’re violated. 

In Wednesday’s blog post the suggested short was 5581.25. New levels were offered on Thursday. This doesn’t mean the prior level “came off” the charts. Yesterday during premarket trading, the suggested turnin...

Yesterday’s results: Buying 5422.25 just missed picking the bottom of a wild session, offering a 4.75-point scalp before stopping out. 

Today’s Best S&P Futures Turning Points: Buy 5484.75 stop 5480.75. Short 5656.25 stop 5660.25.

The World Index: (+100/-100) soars from -21 to +57 with most major world markets firmly Bullish. 

Catalysts: PPI, Jobless Claims @ 8:30. 30-year bond auction @ 13:00. 

Quick Tip: Self-Serving Bias

Trading is more psychological than mathematical. Although the quants might disagree, if you study other successful traders you’ll see they do agree. 

Aside from our human problems about “winning is good, losing is bad” and “being right is good, being wrong is bad,” we have biases to contend with. There are plenty. 

One bias I discovered recently while reading Thinking in Bets: Making Smarter Decisions by Annie Duke, arguably the best tournament poker female who ever played, is Self-Serving Bias. 

Simply put this bias has us giving credit to our skills when w...

Yesterday’s results: Neither trade idea triggered. 

Today’s Best S&P Futures Turning Points: Buy 5422.25 stop 5416.50. Short 5581.25 stop 5584.75. Filter out trades around the CPI release. 

The World Index: (+100/-100) drops from -7 to -21 with world sentiment drifting Bearish on low volatility. 

Catalysts: CPI @ 8:30. Crude Oil Inventories @ 10:30. Ten-year bond auction @ 13:00. 

Quick Tip: Bulls Rule Today?

It’s hard to believe the 9/11 attacks were 23 years ago. I still have vivid memories of not trading that day. 

Sitting on a 100% long swing trading portfolio of stocks and watching the news would seem personally tough. The truth is I didn’t think much about the money or potential loss given the circumstances. There is a time when money simply doesn’t matter in comparison. Thankfully it rarely happens. 

Markets are mostly a collective emotional argument. Since nothing can be much more emotional than 9/11 for the markets and being an evidence-based trader, I decided to take a...

Yesterday’s results: Neither trade idea triggered. 

Today’s Best S&P Futures Turning Points: Buy 5422.25 stop 5416.50. Short 5581.25 stop 5584.75.

The World Index: (+100/-100) remains at -7 with sentiment mixed and volatility low. 

Catalysts: Fed’s Barr @ 10:00, Bowman @ 12:15. Waiting for CPI tomorrow.  

Quick Tip: Moving Stops

The stop loss placement decision is made before entry. It’s at a price where your choice of direction is proven wrong. 

You can always tighten the stop while the price is moving in your direction to minimize the risk. No one will tell you to increase your risk by moving the stop farther out if the price is going against you. Another alternative is to not move the stop at all and manage out of the trade from the profit target side. 

I know successful traders that have opposing views on this subject. The correct answer is not simple, though. You need to know their trading style and risk tolerance to truly understand their answer. 

Trader A enters momentum...

Friday’s results: Buying 5461.50 only bounced for 6.50 points. Shorting 5521.00 stopped out for a full loss. 

Today’s Best S&P Futures Turning Points: Buy 5382.75 stop 5379.25. Short 5581.25 stop 5584.75.

The World Index: (+100/-100) jumps from -43 -7 with Asia Bearish and the Western world Bullish. 

Catalysts: Nothing obvious. 

Quick Tip: Tick Trick

A popular indicator for day trading stocks and index futures is the NYSE Tick. It’s a sentiment indicator that measures the number of stocks moving up versus down. For example, with about 2300 stocks on the NYSE if 1500 made an uptick on the last trade and 800 made a downtick the tick index would be +700 (1500 – 800). 

You can use it as supporting evidence to take long/short positions and as confluence for trend. Readings above zero support buys and readings below zero support sells. Keep in mind that it’s only effective for very short periods of time. 

The main problem with the tick chart is interpretation. Using a one-minute time ...

Yesterday’s results: Buying 5469.75 filled in the Globex session catching the low of the session and ran for 14.00 points still open and running. 

Today’s Best S&P Futures Turning Points: Buy 5461.50 stop 5458.00. Short 5521.00 stop 5525.75. No trades suggested around the Non-Farm Payrolls release. 

The World Index: (+100/-100) drops from -7 to -43 with most major world markets back to Bearish. 

Catalysts: Non-Farm Payrolls/Unemployment Rate/Average Earnings @ 8:30. Fed’s Williams @ 8:45 and Waller @ 11:00. 

Quick Tip: Night Moves

One of the nice features of trading the volume levels from this newsletter is the set/forget entry available on the reversals. 

Yesterday’s buy at 5469.75 didn’t fill until 3:20 AM ET. You were likely sleeping. Placing the order beforehand brought you a welcome “Good Morning!”

You had a choice of stops: leave the initial stop level and potentially give up profit on a retracement or make it a trailing stop equal to the initial risk and potentially miss ...