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"Just before the close the mkt ticks there one time, they get
filled, and then it rallies."
This may be truer than realized in MANY markets. Here's my take on why...
Using the "big" S&P and eMini as examples, many times it may been seen that
a price channel forms at about 2:45 - 3:00 PM, Chicago. If you've actively
followed the market throughout the day, you're either bored, tired or
napping. "Nothing more is going to happen today", you think.
3:02 - 3:04 - 3:08 - 3:12...... nothing happening. The channel is lazily
moving to the right of the screen
All of a sudden, the market seems to be starting to move. "Too late", you
think, "I'm outta hear."
Then - as if by magic - that market moves, and moves big! "I shoulda
stayed" you lament.
One of my 21 Cardinal Trading Rules is,
IF YOU DON'T HAVE A POSITION AT 3:00 PM, DON'T START ONE.
IF YOU DO HAVE A POSITION BEFORE 3:00 PM, HOLD IT AND USE TIGHT
STATIC / TRAILING STOPS.
Too many times for it to be coincidence, I have seen the market move to what
I and my software "think" MAY be an anticipated price target for the
immediate trend IN THE LAST MINUTE OF PIT ACTIVITY! ("Long-term" to me, as
a day trader, is about 5 minutes!)
My thinking for this, is that, by the last minute, those "professionals" in
the pit "know" the amateurs are probably out and price movement is at a
premium. Amateur stops may be almost non-existent (that's another Cardinal
Rule - ALWAYS, ALWAYS USE STOPS!) So why NOT try and "move" the market and
get the "amateurs'" money.
But you, being the wizened amateur that you are, know about this last minute
of price movement, use tight stops and have leveled the playing field with
the "professionals" in the pits.
PS "Trading Places" - good flick !
----- Original Message -----
From: "Robin Cotten" <rcotten@xxxxxxxxxxxx>
To: "Omega List (E-mail)" <omega-list@xxxxxxxxxx>
Sent: Monday, April 5, 2004 9:35 AM
Subject: Re: the loneliest trader
> that reminds me of the movie Trading Places. In the limo the two
> brothers put in an order to buy a thousand of so Pork Bellies below the
> market. Just before the close the mkt ticks there one time, they get
> filled, and then it rallies. If anyone has ever traded even a 1 lot in
> bellies, they can see the humor in that scene. An experienced old timer
> once told me, "Gentlemen don't trade Bellies."
>
> Robin
>
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