October 21, 2005
Wednesday, June 3, 2009 at 11:45PM 
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October 21, 2005 Morning Comments: Looking at the pre-market charts I used for the morning strategy sessions, above, I was quick to point out that the green Major Median Line was still firmly in control. At least one of the traders from the seminar that has moved "off-floor" to trade at a desk at Spike now trades directly off of daily time frame Median Lines and shorted the 1200-01 area [right at the green Upper Median Line Parallel] and took his short position back yesterday at 1176 [right at the green Median Line]. I also pointed out that there had been unusually heavy options related activity and that I would be surprised if price would be able to mount a serious breach of either the Major Median Line or the Major Median Line Parallel. In pre-market trading, prices were about 5 handles higher, and I was interested in watching how the market treated this gap open higher.
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Price did indeed gap open higher and they traded higher, trying to zoom above the red Median Line, but they quickly failed and closed back where they opened during the first bar, setting up a potential failed zoom re-test sale [Note that I marked the first bar as a Zoom Bar, but it should say "Failed Zoom Bar."]. I would sell a re-test of the red Median Line at 1186 1/2, with an initial stop loss 3 ticks above the high of the day, at 11 89 3/4. My profit target would be a test of the blue lower Median Line Parallel, at 1178 1/2.
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Price climbed enough to get me short at 1186 1/2 and then headed back lower, leaving double bottoms and closing unchanged from the previous bar. Once I got confirmation I was short from the CME server, I put my profit order in the market at 1178 1/2.
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Price poked a bit higher and range traded and three bars later, made a new low for the day. And a handful of bars after that, I was filled at my profit order at 1178 1/2. Once filled and out of my short position, I wanted to see a re-test of the same blue Lower Median Line Parallel on a test and re-test entry and I If I got filled, my initial stop would be 3 ticks below the low of the day, at 1176 3/4. My profit target would be a test of the red Median Line. In essence, I wanted to take the flip side of the trade I had just taken profits on.
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You can see from the last chart that price never came back down to give me a re-test to get long at the lower Median Line Parallel. But I made a nice 8 S&P handle profit on my earlier trade, which netted $400 per contract before commissions. There's nothing better than ending a nice profitable trading week with a simple and well-executed winner. When it was clear price wasn't going to let me in on a down side re-test, I called it an "early day," and spent the rest of the trading day working on seminar materials.
For those of that didn't hear, we had a series of multi-media tests this week. People came into the private "virtual room" and got to hear my raspy voice, ask questions, watch me draw...It was a very nice time. I am going to open the room up as soon as I walk into the Spike Trading room Monday morning--between 6:30 and 7am CST. Anyone that is interested can enter the private room, watch, ask questions, see what the software is like. Early on, I won't be answering questions--instead you can watch me work on pre-opening charts. Once the markets open, after I take care of position entry orders, I'll either take questions or if I have anything urgent to attend to, you can watch AutoForks drawing on volume bars in the E*Mini S&P markets, so you can watch what we call "stealth Median Lines" call the tune in real-time. These are Median Lines of our own invention and we've found them to be deadly accurate tools...If you'd like to drop by, follow these instructions:
Go to: www.omNovia.com/sc/spiketrading/demo and then follow the instructions and run the initial setup [it is very easy], then log in with your first and last name. The password is: 1235.
As I said above, I'll open the room once I get downtown. If you beat me there, the room may be open but you won't see me logged in. Once I get in, I'll leave my charting package running with live charts, so you can watch what I am watching. I may be away from my trading desk for periods of time, but while I am there, positions permitting, I'll draw live, answer questions, maybe even show you what I am looking at in a particular market. Everyone is welcome--the room holds up to 100 people.
I wish you all good a fine and wonderful weekend!
Tim
Reader Comments (1)
-Omega replica watchesing at in a particular market. Everyone is welcome--the room holds up to 100 people.