Trade Setup For 30th July

Here are my zones I'm watching for the 30th July

Resistance

1262-1263
1269.25-1270.25
1277.25-1278.50
1285.75-1286.75

Support

1257.50-1256.50
1250.50-1249.50
1242-1241
1233.50-1232.25

My Outlook

Well we certainly threw a curve ball yesterday as Oil fueled the market into a nice gain. It is in fact enough to have me assessing this as a 1-2-3 bottom for the moment.

The VIX has made a similar pattern as the indexes but just in reverse. We now appear as though the volatility and put option interest is ready for a decline.

Oil and Gold made a surprising decline as I thought we would at least make a small bounce. At this point I will go with the flow but Oil does seem to be impacting the indexes pretty heavily lately.

The USD made some further gains yesterday which is also adding weight to the stocks making a run higher at this point. As always though I will take things with a grain of salt as each day occurs.

My Focus

We are currently trading at the 1261 area in the overnight market. As my bias is slightly bullish at this point, I would like to see a small retracement from the market prior to making possible further gains. Ideally we would see some reluctance to sell off past the 1257 area however a retest might be warranted down at the 1250 area. If either of those are met with volume and/or tick extremes or divergences, then I will look for some further gains to the upside.

If we gap above the 1263 area at the open, I would be looking for some signs of weakness to hit at the 1270 area. I wouldn't put too much weight behind a move down from there as a trend reversal though. If I do enter short up there I will keep the trade on a pretty tight leash and be ready for a trend continuation should we show signs of doing so.

For me the focus is going to remain on doing my best to trade only at the s/r levels. As much fun as riding a bucking bull is by trading everything under the sun, yeah right, I want to get my game back on track.

There is only a few ticks of lenience I am giving my s/r levels. Yesterday I made some decisions to trade in the middle of s/r zones which I would like to refrain from doing today. I am going to continue keeping tight stops behind strong areas and place my initial profit target in easy to reach areas. Trailing the second position as usual. Again, I'm going to take the casual approach to my trading but remember to only trade at the s/r zones.

Trading for 29th July

Here is my journal for the 29th July

Today we have the Consumer Confidence Index being released at 10am. So around that time I will try to remain pretty cautious of entering any new trades. Otherwise the rest of the day the market will be left alone from the influence of news. Right now we are trading at the 1240 area.

I will be looking for some possible weakness at the 1243.50 area through the Tick and/or volume. If we break that level I will test longs but still remain cautious with them beneath the 1251 area. Again I am not too confident in any longs beneath the 1251 area but should we show good signs of a reversal down at 1233 I will look at testing the long side.

9:50 We haven't really gone far from the open at this stage. Right now I suspect the news will need to hit before we decided to pick a direction at this point, if we pick one at all. Volume has been high as we moved marginally lower but is now tapering off on the 2 minute. The Tick has remained strong sticking above the zero line pretty well at this stage. Being so early there are no clear signs to me right now with either side. At this point I sit on the sidelines and wait until after the news hits. The safest way to be at this stage.

10:07 I entered short at 1245.75 with my stop at 1247. It was based on a push on news above resistance with a Tick extreme on big volume. We hung around the 1246 for a little bit of time but then pushed higher. I kept a relatively tight stop so I'm not too fussed. It wasn't following the plan exactly but I made the attempt. Next trade I will try to make it closer to the plan. The tick is showing strength sticking above the zero line and volume has supported the higher move at this point.

10:30 Hmm out for a loss again on the short side. I entered at 1247 with my stop at 1248.25 and my stop was hit. I wasn't at a resistance level again. I am trading the failure to push higher after the volume extreme and Tick extremes. Right now I am going to trade better if I stick to the plan. Volume has tapered off on this move sideways and the Tick hasn't made any strong moves beneath the zero area. This market is up so I am best working with that.

10:56 I'm in short at 1248.25 with my stop at 1249.50. Reason being the resistance area hit with a divergence on the Tick and lower volume on the second push higher. I just took my trade off for a tick gain as we weren't pushing beyond the zero area on the Tick. It was a risky trade and I wasn't willing to give it much space. This Tick has been showing stocks holding up like a mofo. Yet somehow I still would like to short the market.

11:23 I am definitely best leaving this market alone today. I have made some less than ideal trading decisions. I just shorted the market again at 1247.25 with my stop at 1248.50. The idea was a 1-2-3 top with the Tick moving into the negative for the first time today. Volume had also tapered off on the move. I'm going to call it a night right here and work on improving tomorrow. Considering I did many things that were not in my plan tonight I think I have come out pretty well. I do believe I have moved back into the short trading problems I had previously.

11:29 Well I just took another short trade for a point loss. Impulse trade mania. I'm closing my platform right now.

Daily Wrap Up

Wow is all I can say. I seemed to be on holiday last night whilst someone else took over and traded my account. I honestly am a bit confused as to where some of my decisions came from. Of 5 trades, really only one of them was according to my plan. It was the third trade which was a move from the 1251 resistance area with a divergence in the tick and declining volume.

Beyond that one trade at the resistance, I would have liked my focus to be turned to trading the long side. I'm not sure there is much I can say beyond recognizing the fact that most of my trades today were impulse based trades. This seems to be a recurring problem I face with my short trades. Not wanting to miss out on what is a "sure thing" move has me entering some short trades that don't exist or too early if they do exist.

The good part of today was that even though I took 4 out of 5 hits, I haven't taken a massive hit in my account. I much rather take the trades and lose so I have something to learn from rather than not trade and wonder what would have been. There is some learning to be done from today so I will accept the way I traded. It doesn't make me a bad trader, I just made some bad trades.

Today for following my focus I am giving myself an 'F'. The saving grace was that I did take a good trade at the resistance area even though it didn't pan out. It was the one trade that was in my plan and I did take it.

Trade 1a: 1.25 Loss
Trade 1b: 1.25 Loss
Trade 2a: 1.25 Loss
Trade 2b: 1.25 Loss
Trade 3a: 0.25 Win
Trade 3b: 0.25 Win
Trade 4a: 0.5 Loss
Trade 4b: 0.5 Loss
Trade 5a: 1.0 Loss
Trade 5b: 1.0 Loss

Trading For 24th July

Here is the journal from the 24th July:

We have important news! Today is the first day this week where we have important news during the trading day. We have the Existing Home Sales at 10am so I will be cautious around that period.

Right now we are at the 1281.50 area and I didn't put in an option for that. Reason being that I don't particularly want to trade inbetween the 1286 resistance and the 1278 support. It is messy up there with the EMA's and such. Therefore I will wait for a break of those areas before I attempt a trade today.

9:50 We have broken out of the range we held yesterday which is good. The Tick had been relatively neutral until we just broke, now it's beneath the zero area. Volume has been picking up as we decline so it will be interesting to see how the day pans out. For the moment I'll just stick on the sidelines waiting for the right time.

10:16 We came down to the 1270 area support but we didn't make a large tick extreme nor a big volume extreme. It had me cautious of entering on the long side so I have left the trade alone at this point and will wait a bit longer for something else. The Tick has moved into the positive but not by much at this point. Volume is declining on this leg up which is also concerning for the buying side.

11:09 My Tick data is currently missing from my charts as I needed to upgrade my platform. So for now I am on the sidelines trying to get it back. We bounced at the 1270 area and reached 1275 before turning back down. We broke the 1270 area and are now beneath it. Volume increased on the move lower. At this point I am waiting for a possible move to 1262 where we may see some bigger buying come in. That is if the Tick is back in action by then.

11:29 Tick still not working. Not happy Jan! If I can't get it back soon there is no point in me staying up to trade.

11:58 Tick has remained shafted. We appear to be having a meager bounce here but it is hardly inspiring. Volume has declined as we moved higher so I don't suspect we have see the days low just yet. For me its time to call it a night. The only opportunity I had to trade was the long down at 1270 but I wasn't confident in the long trade there. It turned out it was simply a small bounce in a bigger decline.

We didn't get a retrace to the 1278 area that would have triggered a short so I didn't get a chance on the short side. Ah well, at least it shows I can stay out when things aren't ideal.

Daily Wrap Up

There really isn't much I can say about today. It was trend down for the whole day pretty much, these are usually the days that catch me out if I'm not in from the beginning.

I did in fact find it good that I recognized a sellers market early on and didn't try to force a long trade at the 1270 support. We did get a decent sized bounce but on days like today it is best to stay on the right side of the market.

It was disappointing that my Tick data wasn't updating during the day. Of course it is restored with the end of day update, that doesn't help me during the day though. I have just downloaded the latest upgrade for the system so hopefully most of the quirks have been ironed out. If not it will be time to look for a new platform.

Trading For 23rd July

Here is my journal from 23rd July:

No major news again today. At this point we are hanging around the 1280 area so it appears as though we will get the gap up at the open. The plan remains the same as earlier, looking for the market to pullback early on. Ideally we would hit the 1270 area but it may end up being just a close of the gap. I'll keep my eyes on 1278 to see if there is a reluctance from the stocks to drive lower.

9:45 In early on the rise here at 1277.25 with a stop at 1275.50. Initial target was at 1279 and taken pretty much right away. Reasons for the trade was 1278 resistance turned support area with volume declining on the down move and the Tick moving into positive territory. Will trail the stop, currently it is at 1276.50.

9:49 Moving stop up to 1277.25 so I don't take a loss on this trade. Registered no volume on the up move and had Tick come down to zero area. Will close out trade if we move into the negative area on the tick. Should really see some follow through buying here. Out of second position at 1278.

10:15 Not much happening in this market. Tick is remaining positive, volume is currently increasing on the moves higher. A bit mixed so I'll stay on the sidelines until we show better indications of what is happening.

10:37 I took a couple of short trades and took losses on both of them. Too early on the short side again it would seem. Second trade my platform became delayed so I couldn't see what was going on. Had to close connection and reconnect. By the time that happened I was taken out of the trade. Pretty disappointing.

10:57 Short again. In at 1286.75 with stop at 1288.75. Looking for a small 1-2-3 top after the extremes on the buying side. Initial target is at 1285. If that is reached the target after that would be 1282 area.

11:00 Initial target hit and taken. Second is now trailing. 1283 area is in fact level of concern next.

11:04 Exit taken at 1283.75 as we made a tick extreme on the selling side and look to be climaxing on the volume side. In this market I'm not willing to give the shorts much room to move.

11:14 In long here at 1284 with a bounce from the fast EMA with Tick extreme and almost volume extremes. Initial profit target at 1285.50 was hit pretty quickly.

11:20 Out at 1284.50 as we were showing signs of coming back down rather than taking off.

11:23 Time to take another look at this market unbiased to either side. We turned right at the 1290 resistance area and have since come down to meet the fast ema. We made a selling extreme on the Tick just prior to my last trade. Volume was pretty strong into the selling but we have seen bigger increases on the buying. Right now it is trend up unless something stops us from making a higher move here.

11:48 In long at 1285.50 in the chop and out at stop which was at 1284. Actually I have no idea why I entered that trade. It was not a good idea to go long so close to a resistance area. Definitely a lesson to be learnt on that one. Time to call it a night I think. An interesting day filled with too much to talk about right now. I'll get to it tomorrow.

Daily Wrap Up

Hehe, where does one start with today? No doubt my broker loves me on days like today as I made a fair few trades. Rather out of the ordinary for me but it is also why I am sort of happy with the day.

I started off pretty shaky today but managed to pull myself together and keep pushing. It is interesting to see the difference with my trading when it is my live account. I didn't follow my plan as accurately as I do when trading the simulation account.

I managed to make a good trade early on, getting on in the right direction of the market. I took a good exit with the initial weakness. There was a strong opportunity to get on again but I didn't place the trade, something to work on there.

The second trade which was a short was testing a turn at the resistance area up here. We had shown a volume extreme and a Tick extreme so it was a good trade. I took a small loss on it as I recognized we weren't too quick to move lower.

The next trade irritated me a bit because I entered short again but soon after entering my platform became delayed. I had to disconnect and reconnect to the data feed which meant I couldn't monitor the market. Not the ideal position to be in when at the most crucial part of my trade. As a result I ended up taking a maximum loss on the trade whilst reconnecting.

I took a break after that to reassess my trading which showed good signs of maturity in my trading. When I came back I saw that my previous shorts weren't such a bad idea, they were just early. I jumped in short again and made a nice trade.

The next long trade wasn't part of my plan as it was not a s/r trade. It turned out profitable but not something I want to continue doing with my trading. The last trade was of a similar mode and something that was pretty much the opposite of my trading style.

I feel like I am writing negative stuff here which doesn't really match what I think about the day. It was good that I took so many trades today, I would say it was over trading but it was what I needed to get rid of some trading jitters. It showed me that I can trade with my live account, take some decent losses but I also make some decent gains. I was pretty close to break even today after brokerage so it was not an expensive learning curve.

Ideally I can now get on with the trading according to the plan with my live account. For following my plan today I give myself a 'D'. It's pretty hard to get below a 'D' so I can look forward to improving on that tomorrow.

Trade 1a: 1.75 Win
Trade 1b: 0.75 Win
Trade 2a: 0.5 Loss
Trade 2b: 0.5 Loss
Trade 3a: 2.0 Loss
Trade 3b: 2.0 Loss
Trade 4a: 1.75 Win
Trade 4b: 3.0 Win
Trade 5a: 1.75 Win
Trade 5b: 0.5 Win
Trade 6a: 1.5 Loss
Trade 6b: 1.5 Loss

Trade Setup For 8th July

Here are the areas I am watching for 8th July:

Resistance

1251.75-1253
1257.5-1258.50
1265-1266
1272-1272.75

Support

1243-1241.50

My Outlook

I guess one could speculate that this is going to turn soon but you could be thinking that for a long time. I'm going to keep a neutral bias as this thing could last a long time but also turn at the drop of a hat. From a longer term perspective the May highs just look like a breather in the downtrending market from Oct 07'.

The VIX continues its steady rise indicating that Put Option interest is slowly rising. What is most concerning about this rise is that it is slow and steady, just like the markets decline. I'm guessing many buyers are getting caught out mistaking the slow decline for signs of a turnaround. I know I thought that only last week.

The only positive note coming from this market right now is Oil's decline yesterday. Not a big sell off but it is a start. I suspect we could see a decent sized move lower at this juncture. Gold has moved down rather strongly from its range highs which also signals good things for the US. It is not pivotal though as we still sit in the range.

The USD has seen some strength over the past couple of days but it isn't anything to write home about. I'll keep my eye out for further declines that could signal the US economy gaining its strength and possibly some momentum.

My Focus

I want to be careful with this market now as it is in a very temperamental area. The pattern suggests further downward movement and I will stick with that until we see something stand out to say otherwise. We are currently at 1244 in the overnight market and my last support area is at 1242.

At the 1242 area I will be looking for some strength but any long positions will be kept on a tight leash right now as other areas don't suggest a strong move higher just yet. If we open beneath 1252 I would look for some weakness if we reach that area.

If we gap above the 1252 area I would think 1265 needs to be exceeded and held to turn into a buyers market. If we gap open beneath 1242, I think all bets may be off for buying and would look for some weakness at 1242.

At the s/r levels I am watching for weakness or strength seen from the Tick and Volume. All stops are placed behind strong market areas and the initial profit target will be put in an easy to reach place. The second lot will be trailed if the first lot is taken.

To address the problem I had yesterday with exiting prematurely, I will state the reasons for exiting early according to price, Tick and Volume analysis. I will also continue using the opening gap strategy with the simulation account and also the offsetting strategy.