Results of Friday’s Best S&P Futures Turning Points: The short @ 4457.50 did trigger (and stop) in the post market but was cancelled due to market volatility from NVDA earnings release. 

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

Buy 4411.25 stop 4407.50. Short 4492.50 stop 4498.00. 

The World Sentiment Index: (+100/-100) rises from +36 to +57 with all major world markets Bullish. 

Catalysts: Jobless Claims & Durable Goods @ 8:30. NVDA motivates a risk-on mood. 

Quick Tip: Strategy Diversification

Given enough capital diversification becomes mandatory. You’re unlikely to have one asset in your 401K. You have a basket of uncorrelated assets to smooth your equity curve. 

But what about strategy? You’ve probably never heard of a hedge fund that ran “one” strategy. Diversifying by strategy makes sense when you consider the...

Results of Friday’s Best S&P Futures Turning Points: Neither trade triggered. 

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

Buy 4388.75 stop 4383.00. Short 4457.50 stop 4462.25. 

The World Sentiment Index: (+100/-100) eases from +64 to +36 with most major world markets Bullish. 

Catalysts: MFG & Services PMI Flash @ 9:45. New Home Sales @ 10:00. Nvidia earnings will be the pivot (trend trade the Globex tonight?).

Quick Tip: History of Trend

You know it all when you don't. My sons reminded me of that. As they approached their teens I noticed they were all smarter than me. Or so they thought.

This made me recall how I was as a teen. Yup. Dad was wrong and I was right. In my infinite "wisdom" back then I decided history was a waste of time. I barely passed those classes.

A couple of decades later I became regretful. History is vitally important. It's...

Results of Friday’s Best S&P Futures Turning Points: Neither trade triggered. 

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

Buy 4364.25 stop 4359.25. Short 4457.50 stop 4462.25. 

The World Sentiment Index: (+100/-100) jumps from +14 to +64 with all major world markets Bullish. 

Catalysts: Existing Home Sales & Richmond MFG Index @ 10:00. Fed-Speak from 13:40 to 15:30. More bank downgrades. 

Quick Tip: Take the Profit?

Rule-based trading is essential for any trader who doesn’t have extensive experience and success already. Eventually you can get to a discretionary state, relying on your intuition and experience, but not at first. 

There is a middle ground, though. A level of intuition and experience where you start to be slightly flexible with your rules. 

A good example of this is open trade management. Let’s say...

Results of Friday’s Best S&P Futures Turning Points: Neither trade triggered. 

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

Buy 4357.50 stop 4353.25 Short 4457.50 stop 4462.25. 

The World Sentiment Index: (+100/-100) soars from -64 to +14 with China firmly Bearish and the west Bullish. 

Catalysts: Nothing on the economic calendar. China continues to struggle. 

Quick Tip: Math Meets Psychology 

Much has been said about the similarities between trading and gambling. Much is true. All is not. A fabulous book you should read about this topic is A Man for All Markets by Edward O. Thorp, an accomplished mathematician, author of Beat the Dealer, and acclaimed hedge fund manager. 

When Thorp tested his blackjack card counting system in the real world, financed by two wealthy (and greedy) millionaire businessmen, he uncovered a significant...

Results of Thursday’s Best S&P Futures Turning Points: Buying 4387.00 stopped out.

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

Buy 4339.25 stop 4334.00. Short 4421.75 stop 4427.50. 

The World Sentiment Index: (+100/-100) drops from -7 to -64 with all major world markets Bearish on rising volatility. 

Catalysts: Nothing on the economic calendar. China continues to struggle. Bond yields are staying high. Risk off. 

Quick Tip: Leftovers

Once you exit your winning trade there are only two outcomes. 

1. You left money on the table. 

2. You got out just in time.

Which do you suppose happens more often? 

The point is wherever we decide to exit, much if not most of the time you’ll leave money on the table. Knowing this in advance should alleviate some emotional reaction to being “wrong on that one.” 

There is benefit in...

Results of Wednesday’s Best S&P Futures Turning Points: Buying 4412.50 filled in the Globex session last night and ran for 18+ points so far, still open. 

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

Buy 4387.00 stop 4382.25. Short 4492.50 stop 4498.00. 

The World Sentiment Index: (+100/-100) advances from -43 to -7 in a world of mixed sentiment and very low volatility.  

Catalysts: Jobless Claims & Philly Fed MFG Index @ 8:30. Bond yields jump on Fed Minutes. 

Quick Tip: Why Day Trade?

If you have a long-only portfolio, IRA, and/or 401-K you’re probably happy with your 2023 performance so far. You’re also concerned about the recent slide. With September and October having some history of trouble, you may consider hedging your longer-term investments. 

You could buy index put options as insurance. That’s an expense,...

Results of Tuesday’s Best S&P Futures Turning Points: Buying 4456.76 stopped out in a fast moving plunge. Read the Quick Tip for more on this. 

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

Buy 4412.50 stop 4407.50. Short 4492.50 stop 4498.00. 

The World Sentiment Index: (+100/-100) advances from -64 to -43 with Asia down hard and the west flat. 

Catalysts: Building Permits @ 8:30. Industrial Production @ 9:15. FOMC Meeting Minutes @ 14:00. China intervenes to protect stock market plunge. 

Quick Tip: Caveat on Reversals 

The suggested turning points in this newsletter are derived from high volume price levels. These represent fair value since buyers and sellers traded heavily at the price both must have considered acceptable. 

Typically, these are good turning points. But when price has significant momentum they can be violated. ...

Results of Monday’s Best S&P Futures Turning Points: Shorting 4510.25 stopped out in the Globex session last night. 

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

Buy 4439.50 stop 4436.00. Short 4543.75 stop 4548.25.

The World Sentiment Index: (+100/-100) drops from -21 to -64 with all major world markets except Tokyo very Bearish on rising volatility. 

Catalysts: Retail Sales, Empire State MFG Index, Import Prices @ 8:30. Chinese economy/debt issues. 

Quick Tip: Resilience 

Baseball great Harmon Killebrew said, “The most important athletic ability is the talent to comeback from behind.” True in sports, true in business, true in trading. 

The great come-back athletes were different than their peers. They knew there would be setbacks. They thought in advance how to handle them. They didn’t get emotional. They snapped to attention...

Results of Friday’s Best S&P Futures Turning Points: Neither trade triggered in a narrow range day. Both levels remain on the chart. 

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

Buy 4439.50 stop 4436.00. Short 4510.25 stop 4516.00.

The World Sentiment Index: (+100/-100) eases from -36 to -21 with Asia firmly Bearish and the west mildly Bullish. 

Catalysts: Nothing on the economic calendar. 

Quick Tip: Simple Not Easy

You’ve probably heard the phrase “trading is simple, it’s just not easy.” Indeed, trade plans can be simple to execute but because of our thoughts, emotions, and behaviors we make them hard to follow thus missing the result we want. 

Let’s say your “simple” trade rules were based on 1) Determine the big picture trend, 2) Sell rallies in a downtrend on a shorter time interval, 3) Buy dips in an uptrend on a...

Results of Thursday’s Best S&P Futures Turning Points: Shorting 4543.75 ran for 51 points to the buy level at 4492.75 that bounced offering 13.50 points. 

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

Buy 4439.50 stop 4436.00. Short 4510.25 stop 4516.00.

The World Sentiment Index: (+100/-100) slumps from +37 to -36 with most major world markets Bearish on rising volatility. 

Catalysts: PPI @ 8:30. UofM Preliminary Consumer & Inflation Sentiment @ 10:00. 

Quick Tip: Open Trade Management

Money messes with our heads. Until you get a grip on the emotions associated with winning and losing, you’re unlikely to succeed. 

Here’s a viewpoint I learned from one of the all-time great traders, Larry Williams: “More money is lost due to overstaying positions (greed) than exiting due to the fear of losing money.” 

Your fear...