Friday’s Blog Results: Neither suggested level triggered.

Quick Tip: Knowing when to change        

Markets are like the weather, always changing. Trends become ranges. High volatility becomes low. Vice versa.

If you carefully analyze your drawdowns you may find that the change in market character was the cause. You can only do this with confidence if you’re logging plenty of data points in your documentation process. We track 43 different data points for every trade, taken or not. This gives us evidence to know when to change.

Here’s an example: The war in Ukraine contributed to an increase in volatility. Losses accumulated. A review of prior periods of abrupt volatility increases showed something counter-intuitive. Reversal trades perform better than breakouts.

Huh? It sure seems with wild swings in price that breakouts would be fine. Maybe for some strategies but not one of ours. Until calmer times we’ll focus the...

Thursday’s Blog Results: No buy fill. The short @ 4497.75 ran for 21.25 points with only 1 point of adverse move.

Quick Tip: Why you lose.

Seems odd that loss would be the topic after posting a nice winning trade. But it’s more important.

Losing trades are inevitable. In fact, losing streaks are inevitable. Drawdowns in equity happen. The challenge everyone faces with losing is your belief system. We are hard-wired from early on to think losing is bad. Not so in trading. Losing BIG is bad. Losing because you didn’t follow your trade plan is bad. But losing at your pre-determined stop loss is GOOD.

Why? Because you only lost what you can truly afford to lose both financially and psychologically. It should be “no big deal.” Your losses should never get you anxious, upset, or reactive. If they do, there are only three reasons:

1. You’re risking too much money.
2. You have no confidence in your strategy rules.
3. You aren’t following your strategy...

Wednesday’s Blog Results: No trades triggered for the day session. Team members saw the short @ 4497.75 run for 50.50 points to the day session close.

Quick Tip: Abundance

The Globex session can be very productive. Many days it’s better than the day session. Less whipsaws. Managing open trades is the challenge. We’re all sleeping.

You can set a stop loss order that trails the price action. This means you’ll always see price go farther than what you took from the trade. This may play with your head. Looking at the chart above you see the price reversal that would trigger your trailing stop.

How do you feel about keeping 21 points of a 50-point run? Lots of different answers to that question and none of them are wrong if that’s your comfort zone. See, if you didn’t trail-stop you would have watched the trade give up 28.25 points on that reversal (blue line). How would you feel then?

The point here isn’t about what is the better exit....

Tuesday’s Blog Results: No entry on long. Short scalped 6.50 points MFE.

Quick Tip: “Zc” ROI

What? “Zc?”

OK… Zc = Zero Cost ROI. Costs nothing, returns outrageous returns. Skeptics and half-empties are moving on. 

You’re not.         

Zero-cost ROI is real. It’s what you get when you read every day. The more topics the better. Reading is the greatest time investment. Period.

Make it a habit. Here’s how: Make a commitment to read something interesting, relevant, and beneficial every day. Set a time limit. 30 minutes is good for starting this life-changing habit.

But to make the habit stick, you need a carrot (get it, stick or carrot?). So, let’s say you want to get your brain started first thing in the morning. Read something motivational for 30 minutes. THEN you reward yourself with a cup of coffee, tea, or lemon water. That is how you make a habit. Do-then-reward. It...

Monday’s Blog Results: Neither level triggered. Team members saw the Globex session behave very well. If you’re not trading the better, more productive Globex session, you’re missing the easier money. (see chart).

Quick Tip: Be proactive, not reactive.

With 40+ million copies sold and a release date in 1989 you’re likely to have read Stephen Covey’s “The 7 Habits of Highly Effective People.” If not, do it now. It is excellent advice and timeless.

Habit #1 says be proactive, not reactive. With so many different styles of trading, you know there are strategies that you can “set and forget,” and strategies that require real-time scrutiny. Proactive vs. Reactive.

Our team of traders do both because we run 4 different strategies (plenty to pick from… sometimes it’s like Thanksgiving dinner). Our volume profile, supply/demand, and SPX strategies can be “set and forget.” Our volatility reversal strategy requires...

Friday’s Blog Results: The suggested long never triggered but the short @ 4412 ran for 19.75 points.

Quick Tip: Stop-n-start.

All trading strategies have drawdowns (a protracted losing streak). The challenge is trading through it. You can’t stop thinking that it may “never come back” or churn for an extended period. Then you get FOMO and think if you stop now it will roar back and you’ll miss the gain. Obviously, these thoughts are destructive. Don’t go there.

What you should do is have Stop-n-start rules to follow. These are rules that tell you when to stop trading the strategy and when, if ever, to start up again. This will take the emotion out of the process. Apply these rules to the performance of individual strategies, not your whole trading account.

Here’s an example of a rule set (see graphic above):

1. Track the equity curve of the strategy.
2. Measure the drawdowns and select the longest you can tolerate.
3. The next time the equity drops...

Thursday’s Blog Results: The suggested short @ 4375.50 stopped out.

Quick Tip: Do something.    

In the past several days you’ve read several blog posts about the components of a proper trade plan. If you haven’t finished creating (or updating) your plan with these 7 critical components, let me help you.

Join me on Saturday, March 19th at 10 AM ET for a FREE, LIVE online mini course, “Ultimate Trade Plan.”

Click here now to see the syllabus and reserve your seat. We’re limited to 100 traders so do this now.

Today’s Best S&P Futures Turning Points:

Short Level: Sell 4412.00 stop 4417.25.

Long Level: Buy 4358.75 stop 4354.00.

Trade well,

Mike Siewruk

P.S. Tired of trading alone? Need more quality setups? Join our team of great traders and accelerate your performance. Copy down this coupon code WINTER2022 and save 100 per month for life on your membership. Click here for FREE video training and details.  

Wednesday’s Blog Results: Neither suggested entry triggered.

Quick Tip: Change is good.

Today’s Lesson: Keep an open mind.

Pandemic. War. Earthquake. I guess it’s over. Bad news comes in three’s right? I thought about an article I read a while back. Five Wall Street traders were commenting on how to deal with disruption in the markets. There were plenty of differences between them including chosen asset class, style, strategy, all the typical things.

There was one huge commonality, though. They all stressed keeping an open mind. Be willing to change. Markets change. Technologies change. Laws change.

Change is not always easy, though. We can get into a comfort zone and not want to leave. But we must if we’re going to grow our trading skills.

Here’s an example of why it’s so important. About 2 years ago, I launched The Daily Market Forecast. We started trading the S&P futures using one strategy with a fixed rule set.

We’re fortunate...

Tuesday’s Blog Results: The suggested short @ 4204.75 ran for 26.25 points.

Quick Tip: Trade Plan Part 7

You’ve made six trade plan decisions so far, time devotion, style, capital investment, asset class, strategy selection, and risk management. 

Here’s the icing on the cake. The magical component that most traders miss. The easy way to gain edge in any market, timeframe, or style. The insurance policy that you’ll always get better over time.

Documentation and review.

You should be building a database of information about every trade setup whether you took the trade or not. This trade plan component alone could fill a book. Better you learn it live. Join me on Saturday March 19 @ 10 AM ET for a free mini-course, “Ultimate Trade Plan.” We’ll dive deep into each of the 7 components and answer all your questions. Click here to register.

Today’s Best S&P Futures Turning Points:

Short Level: Sell 4356.75 stop 4362.50 (consider...

Monday’s Blog Results: The long level ran for +46.50 points but the tight stop ended it @ +9.00.

Quick Tip: Growing Up.

You should have a rules-based trading plan with proven edge. If not, stop trading and get one.

Your trade plan is not a static document. It starts that way then grows with you and the changes in the markets you trade. As you gain experience you’ll tweak your trading plan. Some of the rules you have will be dependent on present time market conditions. Think of them as “If – Then” statements.

Yesterday’s winner is a great example. Looking at the chart you’ll see that the volume level held all morning and offered a 46.50-point runner. The suggested stop had you out with something less than 9 points. No bueno.

Your plan may have a stop placement rule that is ineffective when market volatility is extreme. Like now. Our team adjusts the maximum stop distance based on present time volatility. We used data going back several years...