Wednesday, February 29, 2012


key element I've been ignoring with futures is VOLUME --    volume provides the clear clues just how strong the trend is... and allows you to sit out the chop.     Today was a massive selloff and watched pro traders make over $12,000  staying short. 

Tuesday, February 28, 2012

best trades:

/cl -- forms   H/S top -- then small drop, then huge drop.  And it did the SAME thing the day before.  Was more than obvious.

/ng -- terrible name to go long

1) was red all day
2) no volume

 /tf -- h/s top -- then TL break and another one for big gain.  

  Must follow structure.
  Must have NO bias. 

Monday, February 27, 2012

precursor patterns:

 before getting a big selloff  --   often a H/S top or 3 bump pattern emerges well before.  In both cases, it requires THREE points to form the pattern.     

Waiting for these set ups results in a huge drop -- with virtually no heat upon initial entry.  In most cases the market is extended -- often 3 days into a rally or near a previous  resistance area. 

 The goal is to capture those perfect moments -- and  ignore the rest of the noise.

Thursday, February 23, 2012


shorted /6e -- on trendline break  -- pattern  caught 15 ticks

but gave most of it back trying to short ---  with the 33 over the 99 day MA -- trend up day  and I was ignoring the obvious trend.

 Determine the trend and trade WITH it.   It was up  -- the opening drop set up a trend day.

 There was opportunity to get into /tf  -- but the meat of the move was over before noon.  Trading afterwards yielding little.

 Signals like :  slv, gld, xhb strong should be obvious enough.  Then trade WITH the 33/99 day MA as your guide.  Use patterns to establish entries and candlesticks for exits.

Definitely need to consider other market signals to determine if a strong trend can develop -- then get with the flow.  That's what i learned today.  And secondly: if you have a bias -- NOTE it -- so it doesn't cause you to fight a trend.  A trend is a trend whether you accept it or not.

Tuesday, February 21, 2012

triple tops/bottoms: random?

most of the day is random but I am noticing that virtually ALL of my charts feature a triple top - sometimes two, before a major move.  Either triple top leads to decline... or a triple top breaks - leading to major rip ( oil today)  or triple bottom is broken leading to sharp dip.  (/tf).

 It appears the market is usually noise but tends to tighten into signals before a major move.

 Now -- it is important to use these signals in context.  Is the market overbought?  If so, triple tops are more likely to work. 

 How far apart is the triple spaced?  It appears the bigger formation = bigger move.  

What's the timeframe?  Is it part of a bigger triple?  Is there a larger support line?  Must look at market from several perspectives. 

 The entry will always call for a tight stop as the move should be immediate.  The drawback is waiting for the setup to emerge. 

 I will look for more examples.

Friday, February 17, 2012

/tf - top

morning:   /tf gapping up

but QQQ is weak   -- signal one

/tf  hit a previoius top of 832

/tf then completes a triple top (ascending) -- blowing thru 832  to 833 --  VOLUME SURGE -- blowout followed by red candle.  This was the top.

Later falls under 33/99 MA -- bases -- and good for 30 ticks from THIS level.  (50 from top).  Simple easy - done.

Thursday, February 16, 2012

6e bottom

tight channel  formation --  stock drops below key 1.30 level

then:   big volume spike to 1.2975 with a tail -- 1 min candle

then:  rising 3 bump pattern  directly afterward

then: a BIGGER volume spike but this time vol. pushes ABOVE 33 day MA 

then:  descending channel that had taken hours to form breaks.... 99 day MA breaks.

 so:   major shifts are often preceded by  multiple buy signals. 

 An intial entry would have resulted in over 150 pips -- even AFTER waiting for all this information.

 Therefore:  there's no need to jump the gun shorting or entering long.  The multiple signals will form time and time again.  Allowing an entry that minimizes time and drawdown.

trend trader

as a trend trader:  you must FOLLOW the prevailing trend.

Today's mistakes were ALL trying to countertrend trade. 

 WHY?   Why attempt to do this?  Never again.  Don't make the same mistake ever again.  Ever.

 Only trade WITH a trend.  You buy pullbacks of an existing trend only.  The MAs provide direction.

blown out

what did I learn from today's losses?

1)  33/99 day MAs turned up -- so THERE'S NO SHORT TRADE -- period. 

2)  Resistance trading must be done by check DAILY charts -- MAJOR RESISTANCE only.  Medium areas are pointless.   

 Futures trading is trading with the trend only. 

Tuesday, February 14, 2012

seeing it clearer

today I only did 2 trades and both were winners but i took profits too early -- they could have been huge.

More importantly -- I was watching -- working on my new -- super simple entry system and nailed many entries that led to waterfall declines. 

The last component I realized -- only short when 33 day MA is rolled over -- or long curling up.  The futures need to digest moves and the MAs are important and will signal the proper direction.

The candles continue to show tails which are very helpful for early entries.  These work very well at key sup/res. areas  (otherwise they may not say much). 

The volume also provides clues of exhaustion -- again --  long tail candles/strong vol. at sup/res. often indicate reversals.  But most of my entries would require a TL break so I get secondary confirmation. 

As a result... this entry system provides very very tight risk control.

Monday, February 13, 2012

bottoming pattern on /gc

huge vol.  1 minute candle.

long tail forms on 1 min candle.   next 3 - 5 candles create a rising wedge ---

move back to previous resistance -- either horizontal or top of descending channel.


Huge volume candle pops into area of congestion or into double top. 
Next 3 - 5 min. forms sloping line or horizontal resistance area...  market will then fall to bottom of channel or form double bottom with nearest, most recent short term bottom.

futures: start with bigger picture

I'm getting chopped because I'm not seeing the BIGGER PATTERNS -- namely /es is bouncing off a trendline and provides easy entries.

/6e I noticed several times but did not capitalize.  Once the major support/res. areas fail or hold -- the move is usually swift until the next support area.   The candlestick indicators only really work at the sup/res. areas.

Today I got chopped in /tf --- I was too early and finally at 824 -- it was a top and move 2.5 pts.  It hit this area and completed a triple top (rising channel) == but still.   The pattern was crystal clear -- the main thing is to identify areas of resistance on 10 day charts first.  

Thursday, February 9, 2012


started with /gc -- down  big overnight -- noticed it get over 33 MA with vol. surge -- started to base so I bot -- waited 10 min -- continued to base... popped 15 ticks and retraced.  I felt mad for not taking quick money but it ran again and i took 20 ticks...   ended up running 70 ticks.  Would have been all over.

 Bot /gc  again -- after finding a support area using 5-min -- 5 day chart and this was the bottom of the day.

 But ended up giving most back with choppy trades.  (/6e)

 At one point /gc set up a symmetrical triangle for hours -- it finally broke on vol. surge and was a fast move.  Most big moves are explosive and over within an hour -- preceded by an initial vol. surge.  Most of the day is untradeable and therefore  overtrading MUST lead to underperformance.

 Not waiting for VOLUME is pointless.

 Solar stocks like TSL surged 20% plus -- again we see vol and options activity.  Entering and expecting immediate results (or quick small loss) is the best way to trade.  No need to be IN unless we are using daily charts for entries exits.  But again -- we need to see volume to support a daily chart.

Wednesday, February 8, 2012

proper entries;

saw  /cl -- double bottom  -- dragonfly candles at previous support.  Entry was .10 above -- took 10 ticks -- but ran for over 70.

/tf -- almost entered near low of day -- was good for 80 ticks. 

/ng -- entered midway through large push.  Got 14 ticks - was good for 40.

/6e -- entered multiple times -- got 20 ticks -- was good for 40.

solution:  raise stops on trades that work correctly -- do not settle for small profits on correct entries.

VOLUME surges continue to indicate big moves.

Wait for the best trade of the day.  

note:  /cl topped out at 100  and then again at 99  -- major tops at key price points if no previous resistance levels.

Tuesday, February 7, 2012


/ng  --  dropped to previous support level and touched twice - double bottom, then formed 3 rising pattern and then it was trend up...    VERY OBVIOUS

  /cl also dived --- double bottom, break up, double bottom  -- 200 tick run.  VERY OBVIOUS.

  /tf ---   triple top at clear level ---dipped for 20 ticks.  OBVIOUS.

The fact is -- these patterns are obvious as they develop.  SUPPORT, RESISTANCE.  In all cases, volume spikes at the lows --- yet another clue.  /ng bottomed on the biggest volume candle of the day.  So that should have been the first clue (but not first entry -- it came over an hour later).

  so -- What to look for

1) SUPPORT / RESISTANCE LEVELS  (look back 5 days or so -- look at recent levels)
2) VOLUME SPIKES,  CANDLES with tails at lows.
3) double bottom / ascending triples at support.   
4) buy in direction of trend - set stop below  pattern. 

Wednesday, February 1, 2012


watched two good setups - didn't take them -- both winners - no heat

then took 2 trades that failed --   so bad mental state -- need to clear.   Need to be willing to take the instinctively good ones.   But positive side:  small losses --- took action.  (Just not good action.)