Day Trading with Trend Lines on Gold and Crude Oil earn us easy profits

Click Here To Review Our Automated Trading Results From This Morning

820am est

-          We realize it’s the end of the month and a Monday

-          End of month MAY result in unexpected volume drops and increases, as traders get out of, or into new position to finish off the month or get next month started.

-          We’re day traders so we’re always flat overnight so this type of information is only useful for keeping an eye on the POTENTIAL for a rough day today.

-          Im not going to throw in the towel yet, so lets wait and see what today has in store.

835am est

-          We have personal income comes out slightly higher than expected

-          The dollar is dropping to new lows this morning, which should result in higher prices on the markets we trade most.

845am est

-          We’re seeing a wedge within a wedge on the 34range crude oil chart

-          We’re trapped inside the space between the two support legs of the wedge.

-          We want to be patient here and wait to buy at support.

-          Beware the middle of the range around 98.00 and sell the highs and buy the lows.

920am est

-          We notice that the momentum on the 13range crude oil chart has gone from overbought to oversold VERY quickly.

-          This tells me that we have NO pressure strong enough to keep the market moving in any direction for very long

-          We then open the average true range on the crude oil and we get confirmation of this concern.

-          We see lower lows and lower highs on the 3minute average true range chart

-          This now tells us a LOT about what to expect

-          Narrow trading ranges, end of the month, slow and inconsistent speed all tells us a story, one that MIGHT end in big losses if we don’t pay attention.

925am est

-          We notice the crude oil getting comfortable in the same nasty range-bound market from end of Friday.,

-          We’re trying to look at the BIG picture to find the best possible LOCATIONS to look for a trade.

-          Buy 97.00 but it’s a tough spot, and I can sell 97.65 but it too is in a tough spot.

-          The best location is to buy pullback above 98.00

-          If price drops

945AM est

-          We have news come out, but today has been very slow so we’re trying to find the BEST trading opportunities.

-          What if price rises?  Where will we trade?  We will sell the resistance of 97.65

-          What if price falls to new lows?  We will buy 97.00 the low of the channel.

1015am est

-          Gold has been very slow all day today

-          We now see flat trigger lines on ALL timeframes

-          We also see each trigger line is at the same price level

-          This tells us the market on gold is flat and has been flat for quite some time today.

-          We want to see a steep SLOPE to the trigger lines.

-          We want to use a difference in the price values for each trigger line.

1015am est

-          All the news is behind us

-          We now have to be careful that the speed of the markets don’t get TOO slow so we get into a bad trade

-          Next we see now on crude oil that we are trading right in the middle of the nasty choppy price action from Friday

-          Crude oil trades slowly around 97.50 down to 97.35

-          We need to be very careful trading around this area.

-          Where’s my next pattern going to be high %?

o    Sell 97.60

o    Buy 96.71

o    Stay away from the middle of these two extremes

1113am est

-          We have the market personalities VERY slow and sluggish

-          We were expecting to see a sluggish end of the morning b/c of the end of the month

-          We have hit our profit goal for the day today

-          All the GUESTS and the MEMBERS have their min 30 ticks of profit

-          150 ticks per week

-          We don’t want to give that back, so move to a demo on the FTM

-          We’re seeing dropping ATR

-          And we’re doing our best to wait patiently for the 1130am EST European close.

-          If you were looking to make more profit today you would ALWAYS wait for 1130am

-          If you’ve hit your goal, not that important.

-          I like to LISTEN to how the market reacts around 1130am when the euro markets close down.

Click Here To Review Our Automated Trading Results From This Morning

Automated Trading System Strategy Review

We finished another profitable session of day trading our favorite future markets, but lets take a momentum to review some of the trades the auto trader executed today.

Lets start with the Russell futures, we looked at this last week and lets see how it did again this morning.

We can see 5 trades in the past 3 days in the market, and the results look great.  We take profit at different times with the auto trader, scale-out of each trade and move the stop to eliminate the risk on each trade.

Three losses out of 5 trades would normally mean bad things for a trader, but look how tight our stops are and how wide our targets are.

Narrow stops and wide targets = low draw downs on this auto trader = success in the long run.

Let’s see how this automated trading strategy holds up over time…

You can see the past 30 days on the Russell have been great.  We want to average $1500/mo/contract and we are achieving this right now.

The most important things I watch on this snapshot is the total # of trades per day, as well as the % of drawdown.  I want this to only take the best trades, and it looks like we are getting exactly what we wanted.

Very exciting stuff, you can start with only 1 contract and it takes $1500 to get started.

Lets check the euro currency futures and see how the auto trader did on the euro today…

The euro took 6 trades the last 3 days and you can see they look just as good as the Russell.

There will be a few losses in there of course, but with tight stops those losses wont add up to much.  The winners are large, and we move our stop to entry when the profit is there.

As you can see, not a full loss on this chart.

How about the long term results on this euro market with the auto trader?

Long term results on this euro look….dare I say….amazing.

Low draw down, only 3 trades per day on average, and making much more than $1500/month/contract.

Very exciting to see our auto trader making money for us no matter what we are doing in our live trade room.

And don’t forget…the biggest asset for using the auto trader is that it takes away from the emotional pressure we add when we are learning to day trade.

Knowing the auto trader is earning income for you in the background will dramatically speed up the learning process in your trading because you wont be trading to pay the bills right away….take your time and LEARN.

As always, you can more info on how to use this in our members training on Wednesday @ 1130am EST.

We LOVE your questions and feedback, so please post them!

Market Internals Update

***Economic Data***

- (CL) Chile Jan Industrial Production Y/Y: 4.0 v 4.5%e; Industrial Sales Y/Y: 3.9% v 4.8%e
- (CL) Chile Jan Unemployment Rate: 7.3% v 7.1%e
- (CL) Chile Jan Total Copper Production: 446.9K v 497.6K tons
- (SA) South Africa Jan Trade Balance: -4.9B v -2.3Be
- (CA) Canada Q4 Current Account (BOP): -C$ 11.0Bv-C$9.7Be
- (CA) Canada Dec Gross Domestic Product M/M: 0.5% v 0.3%e; Y/Y: 3.2% v 2.8%e; Quarterly GDP Annualized: 3.3% v 3.0%e
- (US) Jan Personal Income: 1.0% v 0.4%e; Personal Spending: 0.2% v 0.4%e
- (US) Jan PCE Core M/M: 0.1% v 0.1%e; Y/Y:0.8 % v 0.8%e; PCE Deflator Y/Y: % v 1.3%e
- (BE) Belgium Jan YTD Budget balance:-€2.0B v -€11.2B prior
- (PE) Peru Q4 GDP Y/Y: 9.2 v 9.5% prior
- (US) Feb Chicago Purchasing Manager: 71.2 v 67.5e
- (US) Feb NAPM-Milwaukee: 63.0 v 59.9e
- (US) Jan Pending Home Sales M/M: -2.8% v -2.3%e; Y/Y: -4.4% v -3.3% prior
- (US) Feb Dallas Fed Manufacturing Activity: v 12.6e v 10.9 prior

- Equities are broadly higher as markets continue to regain ground lost during last week's mini oil shock related to the unrest in Libya. Oil prices remain elevated in early trading this morning: front-month WTI crude made another run for $100 earlier this morning but is presently trading below $97.50, while Brent crude futures are around $112. Another dose of strong US economic data is supporting confidence, with the February Chicago PMI index at its highest level since 1988. Note that the Chicago PMI employment sub index declined from the January survey. The January personal income data showed solid growth, although there has been some concern about the lack of follow through into consumer purchases given that January personal spending barely grew at all. The January pending home sales rolled back over into m/m losses (as expected) after two prior months of positive m/m gains. Treasury prices are little changed consolidating last week's gains with the 10-year yield holding just above 3.4%.

- In deal news, hospital owner Ventas said it would buy Nationwide Health Properties Inc. in a $5.8B deal, creating the nation's largest health care real-estate investment trust. Note that in his annual letter to shareholders, Warren Buffett said he was getting ready for another "elephant-sized" transaction, although he gave no clues as to what sort of game he was hunting.

- The greenback maintained a soft tone during the NY morning with EUR/USD just shy of breeching its Feb 4th high of 1.3862. The CAD benefited from a stronger Dec GDP reading to hit fresh 3-year highs against the greenback. Overall month-end factors attributing to the soft USD tone.

***Looking Ahead***

- 11:00 (CO) Colombia Jan Urban Unemployment Rate: 13.7%e v 11.3% prior
- 11:30 (EU) EBRD's Mirow Press Conference in Brussels
- 11:00 (US) Fed to purchase $5-7B in Notes/Bonds
- 11:30 (US) Treasury to s $32B in 3-Month and $30B in 6-month Bills
- 14:00 (AR) Argentina Jan Construction Activity M/M: No est v 1.1% prior; Y/Y: No est v 19.6% prior

This information was brought to you courtesy of Trade The News, for your free trial Click Here.  

Fake-Out Breakouts how to Avoid them day trading and swing trading futures

How to predict a fake-out breakout?

-          What I need:

o     Slow timeframe:                  Looking for the trend

o    Medium timeframe:            looking for the pattern

o    Fast timeframe:                    looking for the entry

Slow timeframe:

This defines the trend, or lack of trend.  Then once we see the trend, we want to follow it

We also now begin to see where the highs and the lows of wedges, channels, sideways ranges will be.

We want to trade with the trend, and use the highs and the lows of the ranges as our entry locations.

Medium Chart:

Looking for the price pattern

The slow timeframe told me where to look for the pattern, and which direction to trade, now I need the actual price pattern to show me where im going to be entering the market.

Fast Timeframe:

Look for the same pattern to trigger at the same time as the medium chart.

Use the pace of tape indicator to look for increasing speed, and want big money on the filtered time and sales to confirm the buyers or sellers agree with my trade

How do I get the Pace of Tape?  Indicator for our members

andrews pitchfork technical indicator settings for Ninja Trader 7

 



-          Andrew Pitchfork

o    We posted the settings for this indicator.

o    Uses three trend lines as possible support and resistance levels

o    Add the pitchfork with 3 points

§  1. At the end of the a trend

§  2. Find a major swing high/low

§  3. Find the next major swing high/low on the opposite side

o    This is a calculation to define a price channel that SHOULD come into play

o    You are trying to PREDICT with the Andrews pitchfork

o    I don’t like to predict, I would rather react

o    So instead of using the pitchfork, I use trend lines and look for SOLID PRICE LEVELS to confirm.

o    I draw trend lines as my MAIN focus, because the REAL PRICE is what I need to pay most attention.

o    I don’t trust calculations, I only trust REAL PRICES

o    Use the trend lines first as your most important, but beware of the location of the pitchfork high, low, and middle.

o    We want to buy at the lows and sell at the highs, while avoiding the middle.

-          Don’t trust calculations, I trust price levels

o    Fib levels, moving averages, VAH/VAL, Andrews pitchfork levels

o    I don’t trust these unless we have a SOLID PRICE LEVEL to work with.

-         

-          IF I could only take 2 trades per day, where would they be?

o    Sell the HOD/buy the LOD

o    Trade the PHOD/PLOD

o    Those are the two highest % times you will see.

o    If we cant test the HOD/LOD/PHOD/PLOD then look to sell the highs of the sideways range, or buy the lows of the sideways range.

-          Zen Fire or CQG data? 

o    Personally I know nothing about CQG data other than how to get it as a member.

o    Zen fire works very well I am sure of that

o    I will be testing the CQG data very soon, but it took is provided for NT7

-          Difference between fibs and pitchfork is the fibs define extensions and retracements and the pitchfork finds price channels

-          TradeTheNews.com is a paid service I have been using 5 years now

o    $175/mo worth its weight in GOLD

o    Better Bloomberg terminal

o    Certainly cheaper

o    Has ALL the global news in one spot.

o    Use it for the split second audio news alert to make me aware of what’s going on

o    As a member you can get the benefit of this in our trade room w/out spending the 175/mo.

o    Don’t try to understand everything, there’s a TON of news on here, so beware not to try and do too much.

o   

-          Which months do the DOLLAR index trade?  Same front month as the emini, bonds, currencies

-          03, 06, 09, 12

-          March, June, Sept, Dec

-          I watch the same timeframes too

-          34range, 21r, 13, same stuff

-          Just remember the dollar correlation is a negative one

-          Which times during the day do we watch?

o    I watch full 24 hours a day, 5 days a week

o    Use the chart template and that will guarantee that YOUR charts look exactly like MY charts.

-          What’s the difference fear and lack of confidence

o    Experience is the biggest reason why I will avoid a trade because I lack confidence.

o    Fear is of the UNKNOWN, experience will show you that you have seen everything once before.

o    I can’t lack confidence without experience.

o    Experience is EARNED, you can’t buy it, or get it from a friend.

o    I can make getting that experience a lot easier and MUCH MORE productive when you’re watching charts.

o    Keep track of every trade you take, and don’t over trade

o    Review these trades EVERY day and find out why they were winners and why they were losers.

o    We cover all of this in training and in our video materials.

o    I can dramatically lessen the learning process by making sure that EVERY trade I take is following my rules

o    After 2 weeks of practice, I can now go back and see WHY some trades didn’t work out.

o    Lack of following rules, lack of learning from the past, this will result in repeating the same mistakes you did while a rookie.