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Wednesday
Jun032009

October 21, 2005

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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

Wednesday
Jun032009

October 19, 2005

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October 19, 2005 Morning Comments: Looking at the pre-market charts I used for the morning strategy sessions, above, I didn't see any particular areas that jumped out at me--No Lines of Opposing Force, no confluence, no zoom bars that had set up late in the day yesterday. It looked like prices were going to open 4-5 S&P handles lower, and my one piece of advice was to be patient and wait for the market to show you a solid set up before even thinking of getting on board. Under no circumstances should you be chasing prices...

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Price did indeed gap open lower and trade quite a bit lower, testing the longer-term Lower Median Line Parallel and then bouncing out of the hole. At about 10am, price had peeked above the pink down sloping Median Line, filling the gap and making a new high for the day of 1183 1/2. But the next bar zoomed the same Median Line lower and so I decided to attempt to sell a re-test of the down sloping Pink Median Line at 1181 1/2, with an initial stop loss 3 ticks above the high of the day, at 1184 1/4. My profit target would be just above the re-test of the blue up sloping Major Lower median Line Parallel that price had tested right after the opening today, at 1174 1/2.

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Price climbed enough to get me short at 1181 1/2 and then headed back lower, through the green Major Median Line and eventually testing the pink down sloping Lower Median Line Parallel at 1175 1/2, before it began to consolidate a bit. At this point, I was 1 S&P handle away from my profit target at 1174 1/2, so when price left a double bottom and then started to climb out of the hole, I moved my initial stop loss order down to break even on the trade--afterall, I had six S&P handles of potential profits in the trade at one point. And there always has to be a point where you say, "You can have my brokerage, but you can't have any of my money now..."

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About the time I moved my stop to break even, I walked in to begin teaching my weekly Market Maps seminar at the CME, so I was out of touch with what price was doing [and obviously what was going on with my position]. My orders were in the market and one of my partners was watching over them and I literally didn't give them a thought...

This was one of those strange days when looking back, you feel like you missed a whole chunk of time: As I was finishing teaching my seminar, I didn't feel well, so when I got back to my trading office, my partner, the Mayor, told me I looked a little tired and suggested I go home and take a rest. That sounded like such a good idea, I simply agreed--and as I was walking out the door, I asked him if he had taken care of my orders. He replied that I had been stopped out at flat. And to be honest, that was fine with me. Sometimes you hit them straight, and sometimes you don't. And if you scratch a trade, that's generally not a bad day. I must have been tired, because I didn't even look up at one of the literally hundreds of monitors hanging everywhere at the CME to see where the markets were trading. I simply got in the elevator, went down to the parking garage and drove home and took a nice long nap. And it wasn't until I started to do my chart prep for today's posts and update my hand drawn charts that I saw just what happened while I was teaching the seminar!

At this point, the break even stop looks pretty good, especially since I don't see a low risk entry that would have gotten me long. A long time friend from the East coast once said, "Take care of the losses and the profits will take care of themselves." Amos, I'd say it's days like these that prove just how right you are, my friend.

For those of that didn't hear, we had a nice multi-media test today for several hours. 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 do not know what my schedule looks like tomorrow. Anyone that is interested can try to enter the same private room tomorrow and if I am available, the room will be there and be open with the same password. If I'm there, people can come in and watch if they're interested, ask questions, see what the software is like. I might have AutoForks up "live" 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 unless I am swamped with morning business. 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. I mentioned our short S&P position several times this morning--though we are in no way giving trade signals--so some folks got to follow along if they were there for the early session. Everyone is welcome--the room holds up to 100 people.

I wish you all good trading!

Tim