Monday, October 11, 2010

10/11/2010 Range Day

Good evening traders,

Bloggin from the couch tonight cause of my sprained ankle. today was a range day by all measures. I wanted to due a Range day blog post cause I haven't done one since this blogs inception.

Here are some of the dynamics of a range day. I ripped them off from Brett Steenbarger's blog Traderfeed Hopefully he doesn't get pissed but if he is honest about helping people learn to bank coin in the market then he shouldn't care about my rinky dink blog biting his material. Its actually really good stuff and I want to catalog it here for my own reference. Lets see what Brett has to say ...

1) Advancing and declining stocks running close to even;
Advances 1,678 (53%) 1,243 (45%)
Declines 1,383 (43%) 1,421 (51%)

2) Price oscillating around a relatively flat volume-weighted moving average
ES futures mid point was 1162.50 until the final 15 minutes

3) Mixed performance--no distinct themes--among currencies, rates, and related asset classes;
4) Mixed performance among stock sectors; Today's heatmap shows these two points perfectly

5) Reduced volume on the day.
10/11/2010 102,731,872 SPY traded. vs average volume of 200 million.

A few more things I wanted to say about range days is that the VIX is usually lower or muted and so is options volume. Both of those attributes appeared in today's markets. Also price should end at or near flat for the day.
10/11/2010 S&P gained .01 % today . 'nuff said!

I hope this post will help your trading. Bookmark it if you have trouble trading these types of days. My hope is that traders out there become better by sharing though sharing of ideas and giving up some time every night to help out the community. Thanks for reading!


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