12/08/2009 Low Risk Entry

Hey Traders,

I'm looking at a nice low risk entry tonight, just based on some simple observations with the FIb's and price action . We formed a nice base down here in the 1088 region (Drawn on the chart in white) and based on some longer term indicators we are due for a nice bounce.

build a position around 1090 area

The first target is at 1095.25 the 76% retrace

The second would be in the 1099.75 - 1101 region. I'll have to see about a runner. I don't expect too strong a move.

Stop is at 1087.50

so 2.5 points to make 10 points. I like that . I welcome your thoughts in the comment section

11/21/2009 That's how to spot a top

There you have it! Great looking setup don't you agree? All kinds of "analysts" could say all kinds of things about WHY the CL market dropped... 'The oversold dollar rallied pushing commodities lower' or 'The fundamentals and crude stockpiles don't support the price'

I took the same exact chart from earlier this week but just changed the colors of the lines. I wanted to take the red line off of it too because I was only using that line to make an example and I didn't want people to get confused. Honestly, if you used either line you made money, its just that you would have been in the red at first.

The long white line outlines the clear support and its a classic looking top. I am making this post for my reference as much as yours. I like to save these charts and go over them from time to time. It keeps you sharp, and so does writing a blog. The blog also makes me feel accountable for my results. If you are struggling as a trader, SERIOUSLY you should have a blog or journal at least. ESPECIALLY this is your only stream of income. I assume most of you got a little "side hustle" going on though ;)

Thanks for reading hope you made money!

-Nate

11/18/2009 Drawing Trendlines

Good Evening Traders,

First, my apologies for the lack of updates. I have been doing a lot of work recently and haven't been able to devote much time to the blog. I expect this to be the case going forward as the holidays are quickly approaching. I wanted to devote a post to something I use extensively in my trading. Trend lines. An old saying in the market is "The trend is your friend". Read on to see how I use trend lines in my trading.

First, all traders should know what a trend is. Simply said its the general direction of price movements over a given time frame. Identifying trends and riding them is a surefire way to bank some cash in the markets. BUT IF YOU WANT TO MAKE SOME SERIOUS SCRATCH IN THIS GAME YOU NEED TO IDENTIFY WHEN A TREND HAS CHANGED OR IS ABOUT TO CHANGE. There are easily 1,000,000 ways (and about as many technical indicators) to spot the end of a trend but one of the simplest and time tested ways remains drawing a trend line.

You would think that this would be pretty straightforward, but I see so many traders posting charts on chart.ly with the most bizarre looking trend lines on them. I noticed that people have a tendency to draw a trend line that suits their thesis on the market they are trading. Everyone loves to be right and poor traders always try to rationalize staying in a losing trade any way they can. What's important is having a straightforward system that guarantees you draw a consistent line every time you analyze a trend. Markets are a little like golf in this way, consistency is key!

I learned how to draw a trend line from Victor Sperandeo. No, I don't know Vic personally, although I wish I did! I just bought his book Methods Of A Wall St. Master a couple of years ago. Its a great read and has paid for itself numerous times over. Victor draws his trend lines "FROM THE LOWEST LOW POINT TO THE HIGHEST MINOR LOW POINT PRECEDING THE HIGHEST HIGH SO THE LINE DOES NOT PASS THROUGH PRICES IN BETWEEN THE TWO LOW POINTS." The key is that the line does not pass between prices in between the low points. Lets look at the chart to illustrate this better.




Notice the line goes from the lowest low to the lowest low preceding the high WITHOUT PASSING THROUGH PRICES. Here is how NOT TO DRAW THE TREND LINE




Now this line IS (generally) a "trend line". It does go with the trend, but what makes it wrong is that it passes through prices in two different spots and TOTALLY IGNORES THAT SWING LOW BEFORE THE HIGHEST HIGH. If you were the trader who drew this line you would probably be saying something like "It broke the trend and now is back-testing it. The market is sure ripe for a short!" Now you may be right, but did you draw that line to fit your thesis, or are there certain criteria you looked for first? Do you constantly repeat the same formula every time you draw on a chart? If I gave you any old chart would you draw the same trend line? Are your rules simple and easy enough for anyone to apply? If the answer to any of those questions is "NO" then you are doing something wrong. And likely losing money too.

Here is another good example on CL futures




Once you learn how to properly draw a trend line noticing changes in trends becomes much easier. Same thing goes with staying in a trade. Lets see how that crude chart turned out...




See how I "manufactured" a trade using the red line? It's easy to do that when you REALLY BELIEVE the market is overbought and all your $1900 dollar indicators are screaming short. Meanwhile you wouldn't have gotten too far in that trade. At best you reached your profit target on one or two contracts.

One more thing to remember is TIME FRAME. This method of drawing a trend line, like all market observations, needs to be taken in the context of the bigger picture. I want to look at that same crude chart one more time on a longer time frame. The key here is the white line I added.




Is a change in trend occurring in crude? Depends on how you look at it. In the near term though...It certainly looks like it.

-Nate

09/28/2009 Trend days can kill your account

Hello Traders,

I know its been awhile since I made a post but today seems like a great opportunity to discuss something that gave me trouble early in my trading career. The TREND DAY. Do I need to define trend day? I don't think so, its pretty self explanatory, the market just keeps trending. Simple. This kind of day can wreak havoc on indicators and account equity ! We're gonna look at the chart to see how to avoid these pit falls, but first some background...

With an absolute lack of economic news, M&A took the spot light. Abbot made a big bid for Solvay and Xerox gobbled up business process outsourcing company Affiliated Computer Services. Johnson and Johnson got in the mix too, buying up an 18% stake in hand sanitizer maker Crucell. While it is good to see companies making acquisitions, I wouldn't get too excited, this economy is still in the toilet in my opinion. BUT the market has less and less to do with the economy these days, its mostly just squiggly lines on charts, and if you treat it that way you will make way more money. I promise :)

Looking at the chart, the signal to go long occurred between 4:30 and 5:00am with the two SMI lines crossing, the particle oscillator crossing above the 0 line and the OBV panel painting a red square indicating divergence in price and volume. What's that, you were still asleep?? Traders don't sleep!! Ok, I'll admit I was asleep too...

The next entry was at 9:45am on the break to a new high. 1048 to be exact. The SMI's were already stretching to the upper range at a value of around 60 -- with 80 being over bought. Why go long? If you were looking at the bigger picture (daily) you would see a textbook bounce off the 20 day MA. And I MEAN textbook man! Good traders are always, ALWAYS, looking at the bigger picture for clues. You must understand that. The big fish don't care about 2 ES points, and its you Vs them. got it? cool.

Back to the chart. Lets say you got in at 9:45 am at 1048. By 10:11 you should be taking profits of 7 points with the SMI's red and the OBV painting diamonds left and right. The key is to recognize that this is a trend day early and make sure you are on the right side of the trade. The white box shows the SMI pegged above 40 most of the day. I'm sure any indicator I put up there will be pegged all day too. The market reached its fair value and stuck there. The particle oscillator stayed green all morning and that means NO SHORTS! By the time it crossed the 0 line again you should have been teeing off on the fourth hole and maybe on your third beer ;)

Trend days can be tough. Alot of traders that don't see the trend end up trying to bet against the market when their indicators are showing oversold/overbought conditions. If you can't trade a trend day then just don't trade. Stick to what you know. Lets say you traded 3 lots today and took profits at 4 ticks, 6 ticks and left a runner for 7 points...that's 38 ticks ($475.00!!) . Way better than any McJob I can think of.

Here are the take away's: Recognize the trend, don't fight it, and walk away when you got money in your pocket. Its really that easy.

Thanks for reading guys. All the indicators are from Big Mike's trading blog VIP section. make sure to pay him a visit and if you got a second click those Google ads over there on the right. Feel free to comment too. Later,

-Nate

09/07/2009 Market Outlook

Hello Traders,

I just want to jot down some thoughts real quick about this week's market. Friday's action was very light. The market continues to deceive gravity as well as conventional wisdom about equity valuation. The wild card remains to be the Dollar. The Almighty Buck. If it breaks 78 it seems 75 is easy. The dollar is clearly the sacrificial lamb in all this mess. So lets say that happens... well this market could easily ramp up another 2-3% as commodity speculation begins to run rampant. How much do you think people are going to love $3.50 a gallon gas and $5 a gallon milk when they are broke and unemployed? That's irrelevant though because earnings will go higher and so will the markets. Class warfare anyone? Ok, I'll kill the conspiracy talk.

I'll be back a little later with a chart and some key levels to look at.

-Nate

Good Evening Traders,

Tonight's post will be brief because the Steelers game is on! Yesterday I said I wanted to short this level, 1005. Well, things didn't quite play out the way I thought they would. The 3:30pm Ram job compliments of 85 Broad St opened up some possibilities. Lets discuss them

First off, 985 is untested. And so is 975 below that. I strongly believe we are going to test those levels. Yesterday's chart is still very much in play. I said yesterday those price levels " could take the rest of this week or even the next..."

I want to break it down on a smaller time frame though. Tomorrow we will know the employment situation in America. I expect it to be in line with the consensus or a little better, -200k-ish. Everyone who studies the markets knows this number is highly flawed. They can tweak things like the birth/death model and make up whatever numbers they want. We all know its not the numbers that matter but the reaction to them. This is bigger then Fed day IMO.

On tonight's chart I kept the indicators nice and simple. An RSI, MACD, and some Bollinger bands. Take note of the divergence that formed on the RSI. There is now good separation on both the MACD and RSI with the prior crossing it's zero line. Also, note the strength of the histogram on MACD. Basically everything is pointing higher. I made a few marks on the chart where we could find resistance. There is a Fib level at 1009.25 to keep an eye on. Putting on a short there with a stop at 1012 seems like good risk reward to me. I will be watching the Globex session and pre-market tomorrow to see if price can get up to 1010. I honestly think this afternoon's squeeze was just buffering us for a nice 20 point decline tomorrow.

Steelers are looking sharp and I keep getting distracted! You can follow me on twitter. Please click on the ads if you like what you are reading. Have a good night everyone. Get some sleep its gonna be an early morning tomorrow.

-Nate

09/02/2009

Hello Traders,

I was very excited for Wednesday this week because I would have all morning to trade. Turns out things were very very choppy. I ended up taking a short at 11:30 from 998.50. It was just a scalp set up though and I closed it out 15 minutes later for 2 points. BORING....

The big stories today were gold and AIG. Gold was rocking, up 2.5% or so! 27 million shares of GLD traded. This is obviously because the dollar shit the bed. People are talking about bank failures again, Europe looks like trash, and don't even get me started on China. They're "stimulus" money definitely made its way into the stock market over there, driving the price up 80% this year. I read a little about China and from what I can grasp, they have overcapacity EVERYWHERE. Without us buying their crap from Target and Walmart they don't even have an economy. A correction in Chinese markets was inevitable. However, I wouldn't short it with the proverbial 10 foot pole. Why? Cause the government could step right in and start buying up the market and cut your head off in the process. They do that here in America but at least we get a little wool pulled over our eyes by first giving "bailout" money to the banks and have them bid up SPY the last 15 minutes of every Friday. Enough about all that though, I want to talk about the S&P 500

Last week, ( 08/24 to be exact) I said the top is in and went short the ES. I closed the position a few days later and never got back in. So sad. Of course we are down 30+ points from that very day (still falling in after hours as I write this). But what can you do. I don't have an account with $1 million in it (imagine that right), so I'm not going to hold leveraged S&P contracts for weeks at a time. By the way if you feel like letting me manage your futures account feel free to email me...No? ok I'll move on :)

Well, The pullback is here. All the "September sucks for equities" talk feeds on itself, so keep that in mind. I'm going to make a few predictions about where we are headed. First off, this move is almost over. IN TERMS OF PRICE, not time. It could take the rest of this week or even the next, but we aren't going much lower than 980. I honestly expect that price by Friday when the job(less) numbers come out and people start to realize the mess we are in. Then at some point next week the "everything is fine" crowd will be back, and we will fill Monday's gap, moving back up to 1001-1005. That will be a great time to get short again in my opinion. I drew out how I expect price action to look on today's chart. Am I the man with MS Paint or what!

Lets see how things play out. There are always wild cards out there. If you are trading this mess keep an eye on Gold and Oil. Also remember the 50 day moving average is closing in and all those IBD reading hotshot fund managers will be plowing into the markets when we get there. I'm sure of it. Its all just squiggly lines on charts to them. Thanks for reading

-Nate

Hello Traders,

This evenings post will be a weekly wrap up. let me preface by saying that many people don't bother using Tick charts that show this many Ticks (6765), but I do, and I find it works really well. Why the number 6765? Because it's in the Fibonacci Sequence (Its the 20th number). What's the Fibonacci Sequence? It's a sequence of numbers defined by the recurrence relation in the equation fn = fn-1 + fn-2 where n>3 or n=3. Ok? You know what..just Google it. The general idea is that the sequence appears throughout nature, (In flower pedals, rows on a pine cone, and even starfish) so it should make sense for it to appear in the markets. Now we all know that markets don't behaved in a predictable pattern, buts its a good starting point for analyzing market data. Math lesson over, lets go to the charts...

We entered the week over-bought. SMI's where pegged in the high 60's, low 70's. After the initial pullback, bulls tried to get things going again early Tuesday. The rise in price set up a nice divergence (marked with white lines) for shorts. On Wednesday, I identified 1016 as a target on a pullback as well as a possible head and shoulder's forming, that could portend much lower prices. By 10am Thursday morning price had reached the 1016 target and the dip buyers stepped in. Last night, I said look for a gap up early Friday, which we got. Price faded nicely and now SMI's are showing a bullish looking formation with short term MA's pointing higher.

Even though we ended the week essentially where we started, I think the action was positive for bulls as there isn't much good news left to cling onto. They managed to defend the higher prices well. especially the breakout level 1016. I will be checking out other charts and reading a lot of news this weekend. Also hoping my home state of Pennsylvania gets a budget passed before the G20! I will likely post Sunday night with some predictions about next weeks action. Enjoy your weekend everyone

$ Nate

08/27/2009

Hello Traders,

I want to do just a short blog post tonight as its been a long day! The target of 1016 was filled and that's about it for the pullback! Very bullish news was again muted this morning but buyers finally showed up after lunch. The Asain markets are about to open and price could get a little pullback it to 1020, then I expect a gap up tomorrow which would be a great shorting opportunity. If you are in the Elliot Wave Theory camp they are looking for a high in the 1041 area then a big drop from there. Other pattern traders are saying a bearish broadening megaphone inside of a broadening megaphone pattern. Anyway you cut it we are range bound this and shorts above 1030 look good along with longs below 1020. I'm flat ES waiting to get another stab short. Good night

-Nate

08/26/2009 TD Ameritrade Special

Hello Traders,

The top is forming nicely. I drew a "head and shoulders" on the 4181 chart and identified 1020.25 as the neckline. Instead of H&S I just call this pattern T&D for the TD Ameritrade commercial that made it a household name [disgusted]. Notice how today's New Home Sales and Durable Goods numbers were pretty outstanding, both coming in above estimates, and yet price couldn't make any progress higher. Looks like this market is ready to roll...

There is plenty of support on the way down but I think mid 990's is a good target. Waiting to see if the bears can get things going. Remember, bulls could drag this out til end of the month to make their numbers ;) I'm short the ES

-Nate

08/25/2009 Top Forming

Today I zoomed things out a little to show you this top forming. I stick by my call from yesterday: The top is in, and we need a pullback to 1016 or lower. Here is what I'm seeing.

Longer Term Divergence going back to 08/21
Shorter Term weakness in the SMI's
Both the long and short term Double MA's going red
Fisher showing weakness and unable to get above -0- line

I also drew out how I imagine the indicators to look when price rolls over. I'm sorry I don't have any fancy chart drawing software other than what came with Ninja Trader. I think you get the idea though. I'm still short the ES

-Nate

08/24/2009 Very Bearish

I haven't been trading much because of the new job, but I also never take my eyes off the markets. I just want to say that today's action was, in my book, incredibly bearish. So why did the price go down today, and why is this bearish?

People were rushing to buy right out of the gate and at 1pm there were only sellers left. Did the sellers come out in force, or did the buying just stop? I think it was the latter. No.. more.. buyers..

Listen, no one wanted to chase this thing ahead of all the data this week. To me, that also means no one will buy if the data is good and prices go higher, because then they would DEFINITELY be chasing it.

There is a lot of talk out there in blogs and financial entertainment TEE VEE about how the S&P could go to 1200. I think that's a little ridiculous don't you? That would mean oil could be around $85 a barrel. People will be pissed with gas at $3.00 a gallon +. Now, I was going to post a bunch of fundamental based reasons why stocks could go lower but the charts do a great job of painting the picture, and they are all that seem to matter anyhow, or we wouldn't have rallied this far to begin with, right? Ok,

You need to understand even the basics of Technical Analysis if you are going to trade profitably today. If you are reading this, I assume you do. On the chart I posted, observe the divergence on the RSI and the MACD. The Wm %R is showing overbought and prices tagged the upper Bollinger Band. On the daily chart today's candle appears as an epic DOJI. If you have ever opened a book on candlestick charting and gone to the "Bearish Setups Chapter" the DOJI is probably lesson #1. Lastly, this quote today from James Cox, managing partner at Harris Financial Group says it all: "We're lining up here in advance of the data this week...This is a good time to get out."

So where do we go from here? Well the breakout level would be the first test. I'm going to short the ES and look for a 1016 target. Price may get a short bounce there but it will eventually go lower. I am putting on my shorts now because the easy trade is on the table. Take it while you can. However, I'm not going to be CRAZY about attacking this to the short side (yet). To me, a pullback is definitely in order

Trades for 08/18/2009

Hello Traders,

Today was a trend day in my book. I didn't make it to the screen until the afternoon so I missed most of the action. I made one trade It was a counter trend short. You can see it marked on the chart. It was good for a quick point. The rest of the afternoon we kinda bounced around in the upper range. Everyone is watching the 991.50 level closely as this is the 50% retrace from the lows of this recent move down. If bulls can't make a push over this line things could get hairy.

Tomorrow I will be starting a temporary position at a Non Profit here in Pittsburgh. I'm very excited about having a job but at the same time sad to leave my trading desk. If I blog, it will be light. Trading is an addiction for me. I have been doing it for almost 6 years now and I doubt I'll stop. My strategy will likely shift to swing trading and for that I use deep in the money options.

I appreciate all the emails and friends I made in the few short weeks this blog has been in existence. The best part about blogging your trades is making yourself accountable. This alone has improved my skill 100%. It makes you think a little harder before you pull the trigger. I recommend any struggling trader do the same thing. Thanks for reading everyone. This is goodbye... for now ;)

-Nate

Trades for 08/17/2009

Hello Traders,

Monday was a drag. By the time anyone woke up the move was over and the money made. Futures had gaped down and stayed there ALL DAY. We didn't even get that last 15 minute rally courtesy of 85 Broad Street. Just chop all day. Even worse, Twitter was down making me extra bored. On a day like today I want to limit risk so I trade one lot. I had two trades one for +4 and one for -4. So Mirus made more money then I did. Hopefully things are more exciting tomorrow so I have something to blog about! See you then

-Nate

Trades for 08/14/2009

Hello Traders,

I'm titling this post "How To Lose Money Lesson One". To start lets talk about the indicators I was so excited about last night. For one, The charts worked extremely well, even though we spent the majority of the day in chop. Unfortunately, my execution was sub par. Here is what happened.

This morning we were consolidating at the recent highs. Aggressive traders could have taken a short at 1012.50 when all the indicators were pointing lower. conservative traders would have waited for the chop to subside, or to break below recent support. I marked the entry at 1008.75 and an exit when all indicators went blue at 996. That's 12 points! great trade right? wrong! I missed the whole move. Don't even bother to ask why, there is no excuse for missing that move. none.

Moving on. The SMI formed a nice little divergence at quarter to 12 that I marked with the white lines. You could have taken a long there with stops below the swing lows (992.25). I took this signal and 45 minutes later decided to give up on the the trade closing out at break even. Technically there was no reason to exit, other than I wanted to limit risk during the lunch hour. The proper way to manage this trade would have been to keep moving my stop up to the most recent level of support. Failure on my part once again. Epic fail I might add, because this ran for 10 points.

Remember yesterday when I said if I made $1100 I would be buying all of Pittsburgh drinks? Ya, well that ain't happening. My actual trades are plotted on the chart below. You can see I got chopped to death all afternoon. I took a loss of 19 ticks or $237.50. Putting me basically at break even for the week. Lower on commissions. It is not a good feeling to spend 40 hours staring at these charts all week and have nothing to show for it. That really doesn't even count the endless hours I spend on forums, this blog, tweaking setups, and all the other research I do on a daily basis.

Failchart


I'm not going to let myself get discouraged though because there is still a lot money out there to be made, and I plan on making it. I'll obviously be working on this all weekend, along with refreshing my programming skills so I can get some type of strategy set up that I can back test. I'll work on the rules tonight and post them at some point tomorrow. Thanks for reading guys enjoy your weekend, especially If you made money!

-Nate

How I'm gonna trade it tomorrow

Good evening traders,

Mike Vik signed two years with the eagles and I vomited a little bit in my mouth and had to swallow it. Moving on...

Here is how I'm going to play it tomorrow. First check out the chart above. You like those entries? go visit Big Mikes Trading Blog. This is most likely the chart I'm going to trade off of tomorrow. You can play along at home if you have Ninja Trader. I'll likely be using one contract just to test it out and I recommend you do that same, or just trade it in SIM.

Follow me on Twitter, visit the sponsors. You know the drill. See you tomorrow

-Nate

Trades for 08/13/2009

Hello Traders,

No trades today! If you follow me on Twitter you know why. But if you don't, my daughter had a doctor's appointment at 9am and I didn't send her to daycare after. So I was in and out periodically throughout the day, doing a few tweets and watching cartoons. Its a shame I didn't trade because there were some great setups! The rule is no trading with kids around, so I stuck by it.

Lets talk about the new chart!
Its from our good friend The Wizard at Big Mike's Trading Blog . I had it running all day to grab live data. looking it over, it gave some decent entries that I'm really excited about. The rules for entering and exiting are on the forum so go check it out. Here is the gist though, when the fast SMI line crosses the Slow SMI line take a trade with the trend. pretty simple right? Maybe...

I'm going to go over some of the setups produced today. I marked them on the chart. The Arrows are entries and the 'T's' are exits.

The first one was a long at 1000.75 and flat at 1008.75 (marked with a "T"). Nice 8 point move right!
The next one was Short at 1008.00 and flat at 1006. Good for a quick two point scalp and helpful in setting up a great divergence (marked by the sloping white lines).
The Divergence played out well, giving another short at 1008.75. This one was good for 5 points! exit 1003.75
The last trade was a long at 1005.50. Its still running but I would be getting flat here in AH at 10012.50 so we will count that 7 points.
So 22 points total or $1100 in profit in one day.

So what do we say, Freaking super right! No, not really, ha! These things look easy in hindsight. Trading this thing live is another story. You have to have a keen eye to recognize the support and resistance levels. Also it just so happened we had a volatile day. Lets say we had a choppy day like yesterday, where we zoomed up at the open and chopped around there until the Fed announcement. What would have happened? I lost 28 ticks yesterday if you remember (I sure do). So caution is advised before just jumping in with both feet.

Another point: The original chart setups actually did better than this one! Mostly because it gave entries a little earlier and got you out of trades quicker too. The conclusion, this setup lags a bit. Now that is not necessarily bad. It might be less likely to get you into a false signal. In my opinion, we have to be in a pretty decent move to get those two SMI lines crossing.

EDIT: Wiz sayz use a 380tick chart for entries kids! I'll be checking this out further in the meantime keep reading!

So, here is what I'm going to do. Give this chart a chance tomorrow and trade it with one contract. I'm still up on the week, although a small amount, and I'm not really in the mood to blow it. Now if I make $1100 then I'll obviously be buying everyone in Pittsburgh drinks! So lets see how it goes, follow me on twitter @twitter.com/infected1172. You don't even need twitter to see the updates, just open it in your browser. Visit big mike's blog to download the chart and templates for Ninja Trader and you can follow along. Have a nice night everyone

-Nate

Trades for 08/12/2009 FOMC DAY

Hello Traders,

Today was a blow out for me -28Ticks ($350) pretty much giving back all of yesterday's decent gains. There isn't much to say about this mess today. I couldn't get on the right side of the market until 2pm when I got a decent short entry. Of course I got out too early and ended up getting sucked into another short which was a stop out. I should have been long at that point. But again, blew an entry. The book was so light at points, and the action so whippy I got headfaked into losing money all day.

I'm not even going to talk about the trades because I didn't have a decent winner until 3pm. A winner I should have let run for 4 points! You can see the entries on the chart. Go ahead check them out, you will be asking yourself "What the hell was he thinking??". I'm obviously in a bad mood. I made mistakes left and right today. Its tough to trade these FOMC days, they are best left to the pros, And by pros I mean those with 25+ years of experience!

Overall, I'm not feeling too bad about the losses, its not like I blew up the whole week. Now that I think about it, this is the first losing day I have had since I started the blog. So I'll come back tomorrow with a fresh outlook and a few lessons learned. Odds are about 100% I won't trade the next FOMC meeting! Thanks for reading guys. Congrats If you made $$ Today. See you all in the morning

-Nate

Trades for 08/11/2009

Hello Traders,

Hope you did well today, it was a pretty easy day. The market threw some fakes toward the end of the day but I had wrapped it up by 2:30. All the trades I took today were posted live on my twitter account @infected1172. Lets talk about them real quick

First Trade Short 998.50
Pretty straightforward here. market was in a downtrend, I just needed price to break the 999 support level and I was in. The next two candles were whippy but we finally broke down and I took profits at +4 and +8 ticks.

Trade Two Long 991
I was kinda salty I missed the rest of the move down, but there are always more opportunities to make money. I knew 90 would be support so I just had to wait for the indicators to turn up. The indicators were already showing a slight divergence, making higher highs, I drew white lines to show this. We got a good pop but not what I was expecting and I captured a point on both contracts. I said on my twitter account that I would re-enter again If I got another chance. That's exactly what I did. Nothing wrong with taking profits when you have them. +4 and +4

Trade Three Long 991.75
The bond auction went really well, so I entered a long position. The entry was sub par, I'll admit. I was using the 310Tick chart when I should have been looking at the 1151Tick. I placed the stop at the day's low though and sat on it. I tweeted that 994 was my target and I took profits at +4 and +10 ticks.

So that's It. Three Trades and 34 Ticks ($425 before commissions). I quit a little early but you would too if you did this for a living. My friend Chris at http://10k10weeks.blogspot.com/ was done at 10:30!

Tomorrow is going to be a decent day for trading. A lot of people are worried that bonds will lose their bid no matter what the fed says. How this will effect the market is anyone's guess. Trade your plan and you should be fine. and as always, if you like what you read, please click on the sponsors. Have a good night,

-Nate

Trades for 08/10/2009

Hello Traders,

If you traded today and made money, congrats. This was the lightest market I have seen this summer. I don't have actual volume stats to confirm that, but I know we didn't trade more than 1 million contracts until 3:45 EST. On a day like this you have to mix up your strategy. I switch to smaller time frame charts for entries and only use the bigger charts to get direction. The 1151Tick chart would barely fill half my monitor today! The chart posted above is a 310Tick. indicators are MACD, DoubleMA, ECO2, and VWAP. The shading shows standard deviations from the VWAP(volume weighted average price, you knew that though right?). You can get these indicators on Ninja Forums or over at http://blog.bigmiketrading.com/. I took one trade today for +5 and +6 for a total of +11ticks. Lets talk about it real quick.

Trade One, Long 1001.50:
I didn't get to the screen until 12 and completely missed the move down. This was because my rules say "Don't trade during NYSE lunch hour" (unless already in a trade). Most traders have the same rule, and especially on a light volume day like today, its a good idea to follow that rule.
VWAP was the crucial indicator today. When you see price getting more than +/- 2 standard deviations from the VWAP (for me) its a good idea to start looking for reversals. At 1:21 we where -2 standard deviations from VWAP, the MACD was showing bullish divergence, and Double Moving Average turned blue. I took the long at 1001.50. I traded 2 contracts because of the light volume and strong downtrend. The move lasted for a point and then got ambushed by the bears. I could have taken it off at break even, but I decided to through the pullback. The VWAP was in the cards, I was positive. In the end I turned out to be right and I took profits when we got back to the orange line. +5 +6 = +11

If you follow me on Twitter, you saw I was stalking a short into the close, but I never got a good set up. Time ran out and the bulls ran it higher. Conservative traders are done at 3:30 or 3 if they have profits, so I walked away from the table with a measly $137.50.

Some things to watch this week:
Wholesale Inventories are tomorrow. I expect it to be a nonevent and another slow day ahead of the Fed. Wednesday will have the FOMC rate decision, Federal Budget, and Crude Inventories. I expect the FOMC announcement to be a nonevent too, UNLESS they say they are buying back more treasuries. The announcement should sound like this though; "Rates will remain low, downside risks remain, blah blah blah", basically the same thing we have been hearing. Thursday we have Retail sales. This could be a blow out with gas a little higher and cash for clunkers in full swing, so be sharp. Friday will bring the CPI. I'm not an economist so I don't know what to expect, I do know that they will be watching Capacity Utilization closely because this number has broad implications for unemployment so be aware that its reported at 9:15am.

Unlike last week, which started off big and got slower, this week will start off slow and get bigger. Be sharp, and trade your plan. Good Luck

-Nate

Trades for 08/06/2009

Hello Traders,

the labor report came in a little better than expected this morning. I wasn't paying much attention, honestly. I didn't get to the screen until about 10 because I had a job interview, which was a flop! They sold off the market. someone must have told them that 6.3 million people are still sucking on the government teat. Tomorrow is a big day in the market. Bears might be able to get something going If jobs numbers suck. From what I am hearing people are worried that January and February numbers are going to be revised MUCH LOWER like 1million+ jobs lost. Either way, I will trade it with the trend which so far has been up...on to the trades for today

First trade Short 995.50:
This trade was a mistake that ended up working. The proper short was where I drew the white arrow on the chart and the break of the trendline I drew. I thought I saw something I didn't and took a short so far from resistance I almost got stopped for -4points. As you can see I got one point on two contracts for +8 ticks. risking 4 points to make 1 was bad. By the time we got back to my entry I just wanted out. If I picked the better (proper) entry I would have got 3 or 4 points. But "would have" doesn't count and the trade goes in the books at +8. Lesson learned BTW.

Next and Last Trade Long 991:
This one was off oversold conditions. A lot of buying came into the market at the 990 level and I just waited for the indicators to confirm. When they did I took the trade. The very next bar I got filled for +4 and +6 ticks. Traders using 3 contracts today could have stayed in for 3 or more points. I'll explain why I used two today in the next paragraph.

Today we traded in a range once we found value. I drew horizontal white lines on the chart to show this range. This kind of trading sucks in my opinion. You have to pick just the right points or you get chopped to death by the market makers. I traded two contracts instead of three today because I expected a slow and choppy day, and that's pretty much what we had. I would have taken more trades, especially because we had some great set-ups throughout the day, but I was watching my 4 year old daughter all day. You want a trading challenge? Try doing this while Dora The Explorer is on in the background! Not recommended for newbs... I prefer absolute silence, or sometimes NPR on the radio.

Today turned out ok. +18 ticks on two contracts. Ill take it, better than losing money right? As always, thanks for reading and please click the sponsors if you like what you see. If you want to know more about my indicators and charts visit Big Mikes Trading Blog http://blog.bigmiketrading.com/. Have a nice night everyone

-Nate

Trades for 08/05/2009

Hello Traders,



I was super busy this morning so no time for trading. However, I got back in plenty of time for the afternoon session where I banked 50 ticks ($650)! I posted the chart above and will comment on the trades later. In the meantime I want to give a big shout out to Big Mikes Trading Blog http://blog.bigmiketrading.com/ and the wonderful community of traders there! Especially Sharky, Wiz, Zeller, and Big Mike himself. These guys are the brains behind the indicators I use and if you want to learn to trade like them go visit the blog and sign up for the forums. I just talk trades!

First trade, Short 994.50:
I assumed a continuation on the downtrend would begin here. Especially because the top indicator got a nice divergence going. That wasn't the case but not a big deal. Contracts 1 and 2 were off for +4 and +6. The runner was stopped at break even.

Next trade, Long 996:
I could have gotten into this one a little earlier, maybe 995. but in the end I was happy with the entry. There was a big flush of buyers and the 993 area held up well, probably trapping some late shorts. Those who didn't switch their bias long missed a great move up to over 1000! I got contracts off at +4 +7 and +10.

Last trade, Long 998.75:
The top of the range here was 998.25 so if you were aggressive you could have gone long at 998.50. I waited til 998.75 because I didn't want to get trapped at the top of a range and have to wait through another pullback before we went higher. The order was triggered and I took profits at +4 +6 and +9. In the end I could have stuck with it, but the name of the game is accumulating profits and that's what I did today, going 3 for 3 for +50ticks.

Other news:
We are down in after-hours and some traders are thinking we have hit a short term top. I really don't think so. In my opinion, this market will go higher until something stops it.

Today's action in AIG might have been a good indicator of a short term top but who knows, really. Probably sell the news on Friday when they come out with earnings.

Tomorrow is the Initial Jobless Claims report. I expect that to set the tone for the day. If its in line with forecasts or above and the market goes lower that would be bearish in my book.

As always, thanks for reading the blog. Visit Big Mikes, Traders International and other links please. See you tomorrow on twitter

-Nate

Trades for 08/04/2009

Hello Traders,

Consumer spending is up while incomes fall, which makes no sense to me. But consumers make up 70% of the economy so it doesn't matter if they are broke as long as they keep spending! In other news, 5th consecutive gain in monthly home sales index and a pretty hefty one at that. I'm sure it has to do with it being summer time or whatever. This country is screwed unless we take our medicine and we all know that. You can get the regular bearish dribble on the other blogs. This blog is about Trades and I call them like I see them. follow me on Twitter, now...

Lets Talk Trades

Couple people starting noticing the blog, saying you can't trade live you just draw crappy MS paint arrows on your charts. Yes I do suck at MS paint, but no I can trade, I just don't do it EVERYDAY. Today I traded all day for a gain of +44ticks or eleven points using 3 contracts. I took a total of four trades. I turned the little entry arrows on Ninja so you can see. I'll talk about them real quick and why I liked them

First short at 997:
looked good because of the candle stick formation at 999. I don't know what that's called, and I really don't care because I know its bad. I circled it on the chart. Feel free to post in the comments if you know what its called. My stops are 3ticks above recent swing highs. I put them there so I don't get stopped out on some BullsS1t you know the market makers try to pull on you. I got the targets on contracts one and two and got stopped on the runner at BE.

Next short at 999.25:
Look at that, same formation on the candlesticks. Got one contract off at a point and what a didn't realize is that the blue line was SLOPING up and you don't want to bet against that usually. When its flat that's one thing but the market was clearly trending higher all day, so shorts for scalps only. Other two contracts were stopped out and this trade went for -8

The long at 998.50:
On twitter everyone was looking at the 998 level, and I had been looking for a Long entry since I blew out that short in the morning. I was upset at myself for missing the move up, but didn't want to chase. I had to wait for the pullback and I did. For this entry I just watched the price action and when I felt it was safe, waited for the indicators to turn up. The Market topped 998.50 and away it went. I got all contracts off in profit when things got congested around 1,000.

The last long 999.25:
You can see on my chart that I took the long at 999.25 expecting that to be the break out candle from the wedge. It wasn't, but the indicators kept me in the trade and the next candle was. Great breakout too. Took contracts off at +4 +6 and +9. I wanted to be flat at the close, sucks though because this thing popped hard. Blame the robots or Goldman Sachs or whatever. If you watch it everyday you know its manipulated. Just play by their rules and you'll be fine

I hope you guys did well today. Also, I hope everyone is enjoying the blog. if you like that you see follow me on twitter or click the sponsors, Thanks

Trades for 08/03/2009

Hello Traders,

They kept stabbing at the magic number today (1,000). Cash for clunkers is a big success so that pushed things higher I guess, I don't really know I just watch the charts. Financial entertainment TEE VEE kills me.

Lets get into some trades. First trade was on the break above 990, got a good run to 995 and stopped on the runner. Second trade was perfect shorted on the break below 997 and got almost another 5 points. Right before lunch we got a nice break above 995 and I caught a long for 2 points. Had to get out quick though because the indicators starting giving mixed signals. In the end, that early lunch trade ran pretty good, all the way back to 1k. They could barely get it over with the late push and the system signaled a short after hours. I don't trade pre or post market so didn't take that last one.

Notes on the blog:
You will have to excuse my sloppy charts, I need to make some improvements on the site and pictures still. I hope you guys follow along. Please visit the sponsors and Big Mikes Trading blog at http://blog.bigmiketrading.com/ . See you tomorrow

Nate

Trades for 07/31/2009

Hey traders,

pretty slow day in the market but it is a Friday in late July. when the GDP came out this morning they liked it, then when the market opened they sold it off. I'm sure the number will be revised lower like last quarter's and everyone else must have realized that too. Anyone who trades knows these government statistics are all bullsh1t, but on that same level, we also know its not the number, but the reaction to it.

So Lets talk trades

I generally like to get into a trade when all my indicators confirm. this morning we got a short at 988. It was good for +7 points and then I grabbed a long at 981. when the indicators starting getting mixed signals I exited and went flat at +4 points. We where in chop from about 11 til 1est as indicated by the white dots on the chart. When the last of the longs gave in we fell and then rebounded and I took a long at 985 for a quick +3 points. Around 3:30, A nice divergence formed on the indicators and I took a short at 987 for +3 points. So a plus 17 day. Not bad for a Friday

I'll be working on my blog alot this weekend adding content and features so check back monday for the new stuff. I also plan on adding paintbars to my charts, but i need to find just the right setting, so that's something else to tinker with. Feel free to email me, i'd like to know who is out there reading this.

I hope everyone has a nice weekend. be safe!

What this blog is (and isn't)

Hello traders and future traders. My name is Nathan Stoner and I trade the ES E-mini futures on the Globex exchange. This blog is about trading futures, stocks, and options, although it will mainly focus on futures. I'll post charts and answer questions about my methods and indicators. The blog is black background with gray text because all traders know that staring at a white screen all day will burn your retinas like an ant under a magnifying glass! I

some disclaimers!

This blog has nothing to do with Marijuana! Yes, my last name is Stoner and TRUST ME I realize how easy it is to get confused. You will not find any tips on how to grow pot, or any links to places supplying glass pipes or whatever! For the record, I support decriminalization. Now, lets try to stay on topic !

Futures is a dangerous business! Don't ever take anything I say on here as advice to buy or sell any stocks, options, or futures. You will (not can) lose alot of money trading futures. Believe me, I don't know of one single person trading today that hasn't blown up their account at least once. The market is a beast and it will humble you. I promise. Ok, we got that out of the way.

One last thing. I take trading very passionately so you will have to excuse my inevitable bouts of course language. I'll try to preface some post with the industry standard NSFW if they contain such material!

Now lets make some CASH!