August 30, 2011
- in Uncategorized by schooloftrade
Price Magnets make great profit targets, beware entries
Price Increase 5-10% Sept 1, 2011
End of Month discount Sales@SchoolOfTrade.com
Price Magnets:
Are very common levels of support and resistance that results in price ‘gravitating’ towards them.
Often, these price magnets are very easy to use a profit target, but they make very high risk entries for trades.
You can easily give back any profits you make on using these if you use the magnets incorrectly.
Price magnets are always VERY COMMON, ie, almost every trader, not matter what timeframe or experience level, will easily see it.
Because everyone sees it, our eyes act like magnets and when we stare at something price tends to get there.
Examples:
– Big Money Trigger (BMT)
– Big Round Number (1800, 98.00, 700.00, 1.4500)
– Open (12am EST as my open)
Double-tops/bottoms will also be a price magnet, however, you can also trade around them easily with confidence.
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Minimum Account = $2000 for day trading
– $2500 for Auto Trader
– $5000 for swing trading
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Average Commission for your brokers should be less than $6.00 if you are trading regularly.
New traders will have around $7.00 but once you show your broker that you aren’t trading too high risk and that you trade often, they will lower it to $6-ish if you ask them.
Round turn commission will include:
– .25 to your broker
– All the other stuff is for the exchange fees
– EUREX is 100% electronic so they have lower fees, good example of how fees can be lower in different markets.
– Sales@SchoolOfTrade.com for more broker info
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How should we spend any free/slow time of the morning?
When price action slows to a crawl, what can I be doing to be ready for the next trade.
– Rehearse my daily routine / review your morning prep worksheet (advanced course section)
o Check your news
o Set your alarm
o Take notes about market personality
o Go through my charts
§ Looking for wedges, channel, ranges
§ Moving trend lines to be more accurate
§ Looking for obvious (NEW) levels of S/R
§ Patterns on slower timeframes we can use as a heads-up, clue to trade with them.
When things get slow, this is the BEST time to be preparing for your next trade.
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Are there differences between trading different markets?
– Chart timeframes = same
– Entry Rules = same
– Price Patterns = same
– Indicators = everything is the same except for two indicators
o Pace of Tape will be used slightly differently on HIGH VOLUME markets such Euro, ES, FESX, Bonds,
o Time & Sales Window will use a larger filter (default =5) for the higher volume markets like Euro, ES, FESX, Bonds, etc
– Market Personality may be different from 1 market to the next, but that’s ok because the small changes to those indicators will be an easy way to overcome that.
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Our week ahead:
– Closed Friday ahead of the Holiday
– Price Increase coming Sept 1
– Discounts for end of the Month
– Price action will improve as of the 6th of September, next Tuesday.
