When this blog was launched on July 29, 2021, the focus was on day trading the S&P Futures using a version of Volume Profile for strategy. Over time the content has broadened to include other strategies, stocks, options, swing trading, trade planning, and psychology. This new format should better reflect these changes. Thanks for reading and comments for improvement are always welcome.  

Newbies Only Part 3

Happy New Year! The next several blogs are part of a multi-part process to tune up your trading plan for the coming year. If you haven’t read the prior two posts, you can find them here.

Yesterday you chose a time horizon to trade within and created a “calendar” with times blocked out for your trading tasks, research, execution, and review. 

It’s time to decide how much starting capital you’re contributing to your new “business.” This should be risk capital, meaning money you can afford to lose both financially and psychologically. 

Don’t fool yourself with this decision. Make ...

Thursday’s results: No trades suggested.

Today’s Best S&P Futures Turning Points: Buy 6023.75 stop 6018.00. Short 6097.25 stop 6100.75. 

The World Index: (+100/-100) dips from +29 to +14 with sentiment mixed but leaning Bullish on falling volatility. 

Catalysts: International Trade @ 8:30. Crude Oil Inventories @ 13:00. 

Quick Tip: Risk/Reward

You must have a risk management section built into your trade plan. Without it you’ll fail at trading sooner or later. Many traders think their chosen stop loss order is their risk management plan. That’s not enough. Here’s a list of all the risks you need to cover in your plan: 

1. Trade

2. Psychological

3. Market

4. Liquidity

5. Strategy

6. Brokerage

This game suddenly looks riskier! How do you balance concern over all the risks with a focus on a positive expectation? Target asymmetrical results.

For example, our swing trading team executes a powerful strategy that had a phenomenal 2024. For most of the team, the number of losing t...

Tuesday’s results: No trades suggested.

Today’s Best S&P Futures Turning Points: Buy 6023.75 stop 6018.00. Short 6134.25 stop 6138.50. 

The World Index: (+100/-100) remains at +29 with sentiment mixed but leaning Bullish on rising volatility. 

Catalysts: Jobless Claims @ 8:30. 

Quick Tip: Volume Leads Price

For as complex and chaotic as the markets can be, price chart traders only have 3 variables to analyze. Price, volume, and time. Most technical traders agree that volume leads price. 

Price moving up with volume increasing is very bullish. It’s hard evidence there is plenty of buying interest. Conversely, price moving up with decreasing volume is not as bullish. The buying interest is waning. 

Price moving down with volume increasing is very bearish. The selling interest is strong. Conversely, price moving down with decreasing volume is not as bearish. The sellers are weakening. 

How can you use this data? For tuning your entries and exits. 

If you’re a breakout trader and ...

Friday’s results: The short at 5954.50 failed. The breakout buy at 5965.25 ran for 85.25 points.

Today’s Best S&P Futures Turning Points: No turning points suggested today. 

The World Index: (+100/-100) jumps from -64 to +21 with sentiment mixed but leaning Bullish on lower volatility. 

Catalysts: Consumer Confidence @ 10:00. 

Quick Tip: Flexibility  

Directional traders use a confluence of evidence to make the long/short decision. They use probabilities gleaned from hard evidence and experience. 

We don’t expect to win every trade but it’s important to have a plan for what to do next after a failed trade. The key to success is being flexible. We research and consider all the evidence, decide, then see we were wrong. 

There are three reactions you can have. One, be stubborn and stick with your original direction. Two, stop out the trade and move on. Three, change your mind and reverse the position. 

The flexible trader can comfortably change. Not easy for some but proven by man...

Yesterday’s results: No trades triggered. 

Today’s Best S&P Futures Turning Points: Short 5954.50 stop 5960.25. Buy 5965.25 stop 5959.50 if price retraces down from above. (Filtered out during PCE release). 

The World Index: (+100/-100) dips from -50 to -64 with all major world markets Bearish on increasing volatility. 

Catalysts: PCE, Personal Income & Spending and Fed’s Williams @ 8:30. UofM Consumer Sentiment (revised). 

Quick Tip: Manipulation

Courtesy of the WSJ newsletter – “On December 19, 1868, Cornelius Vanderbilt bought additional shares of the New York Central Railroad. He then convened an emergency meeting of the board of directors, which declared an 80% dividend. The stock shot up over the next two days, at which point Vanderbilt dumped his new shares for a $5.5 million profit.”

Today we have the SEC and regulations to prevent blatant manipulation like Vanderbilt did. But manipulation still exists, just more subtle. 

Insiders are still buying shares ahead of good ne...

Yesterday’s results: No trades suggested.

Today’s Best S&P Futures Turning Points: Buy 5909.50 stop 5904.75. Short 6134.25 stop 6138.50.  

The World Index: (+100/-100) plummets from +36 to -50 with most major world markets Bearish on rising volatility. 

Catalysts: GDP, Jobless Claims & Philly Fed MFG Index @ 8:30. Existing Home Sales @ 10:00. Kansas City Fed MFG Index @ 11:00. 

Quick Tip: Lead or Lag?

The never-ending challenge in trading is forecasting future price direction using lagging information from technical indicators. Better than nothing but you can do even better. 

Significant research has proven that there are two Leading Indicators of price that are not on the chart. Insider buying and Unusual Options Activity. 

Combining the two is the perfect addition to your stock/options trading plan. Learn how in our free training session. Click here.

Trade fearlessly,

Mike Siewruk

 P.S. Share in the wealth! Pass this blog along to your trading buddies. 

Yesterday’s results: No trades suggested.

Today’s Best S&P Futures Turning Points: Buy 6155 stop 6150.75 if price retraces down from above. No short level today. (Filtered out during FOMC volatility). 

The World Index: (+100/-100) jumps from -14 to +36 with most major world markets Bullish on mild volatility. 

Catalysts: Building Permits & Housing Starts @ 8:30. Crude Oil Inventories @ 10:30. FOMC Statement @ 14:00, Press Conference @ 14:30. 

Quick Tip: Trading FOMC

The pattern tends to be range-bound before the announcement and volatile during and afterward. This should help with your trade selection and planning. In fact, if you have solid historical data on your strategy’s performance during FOMC day that is negative, not trading at all may make sense. 

The announcement releases at 2PM ET. You might think the highest volatility is within the 30-minute interval afterward. Historically, it’s the next 30-minute interval when the press conference begins.

When should you trade? Af...

Yesterday’s results: No trades suggested.

Today’s Best S&P Futures Turning Points: Buy 6098.25 stop 6094.25. Short 6095.00 stop 6099.00 if price retraces up from below. 

The World Index: (+100/-100) lifts from -29 to -14 with sentiment mixed on low volatility. 

Catalysts: Retail Sales @ 8:30. Capacity Utilization & Industrial Production @ 9:15. Housing Market Index @ 10:00. 20-Year Bond Auction @ 13:00. 

Quick Tip: What’s Harder? 

Think for a moment before you answer this question. Do you find it harder to take a loss or a profit? 

The answer says a lot about your trade plan, style, trading psychology, and what you need to work on. 

If your answer was a loss, then your risk management plan needs help. You might be trading the wrong strategy, possibly one with more losers than you can accept or large losers. 

If your answer was a profit, then your risk management is fine, but your open trade management needs work. You might suffer from FOMO. 

If your answer was neither. You’ve ...