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Hi RealTraders,
The following is educational content extracted from my website,
contributed here for your enjoyment... Although this example is an
S&P trade (e-mini), the techniques are transferable to stocks and
other instruments. This technique is best applied when there is ample
liquidity, and a good trend.
This is not a "trading system", nor is it perfect. It is one of
several great entry/exit techniques that can give you an edge in a
trending market.
There is more to trading than just entry and exit techniques... My
intention is not to outline a complete trading methodology here.
Best wishes as we approach some important Fibonacci support areas in the
markets next week!
-Neal Hughes.
---------------------------
"Trade of the day Fri Jan 24"
We had more great trades in the chat room today… 20 points on NQ
overnight as well as 14.5 points on S&P, and similar on the Dow YM..
Well done Streeter!
Today I want to focus on a follow-up on the training seminar I did on
Thursday. The entry rules were explained in the seminar, and I was
actually juggling this trade while preparing the seminar for
distribution.
I don’t expect anyone to jump into a trade right after I’ve done a
training session, but the entry was clear, and the gains
substantial.
This seminar was for subscribers only, but this trade-of-the-day will
hi-light some of the key principles.
The over-all perspective is that we were in a down-trend on the daily
chart (MACD, RSI,etc), so looking to short the intra-day chart. We
resisted at a Fibonacci level, .618 at about 889 on the ES chart. Shortly
there-after the Stochastic fast line (blue) closed below the slow line
(red) triggering the entry, in the region of 885. My own entry was more
like 883 though, since I was juggling some conversations and preparing a
seminar...
Intraday 15 minute chart:
<http://www.fibmarkets.com/YaBBImages/Attachments/030124_es_tod_15.gif>
The seminar yesterday did not extend to exit rules, so the following is
unrelated to the seminar.
One part of trading that traders struggle with, is letting profits run.
In this case, the 10-minute Stochastic kept us in the trade all the way
down to the bottom at 866. See 10-minute chart for these details.. The
exit area is marked on the chart.
Intraday 15 minute chart:
<http://www.fibmarkets.com/YaBBImages/Attachments/030124_es_tod_10.gif>
In this case the market went on beyond the profit objective… This can
happen, and should be expected. It’s not realistic to capture every
dollar of every move, especially with just one technique..
Another great day in the markets! Join us every day, [reference to
website and chat room deleted out of respect for spam-sensitive list
members].
-Neal.
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