September 21, 2011
- in Uncategorized by schooloftrade
Fade the News on Mini Russell & Crude Oil Futures for FOMC Day Trading Profits
Today is FOMC Day, which means we have early morning volume so look to get involved early, but then volume will drop off after 11am EST so beware.
We also have crude oil inventories today, which aren’t bad, they just mean we need to watch the clock after 10am for the market getting sloppy ahead of the 1030am news.
815am est
Gold Futures have three price structures
· Price Wedge
All three of these ‘structures’ tell me the very same thing.
As price rises, im selling. As price falls, im buying.
Expect fake-out breakouts, and beware the failures above the highs and the lows.
As price rises im selling the wedge highs and selling at resistance above the wedge highs. Im selling the PHOD 1816.5.
As price falls, I’m buying the wedge lows, and buying the support levels below the wedge lows. I’m buying the PLOD 1772.0
If price trades sideways I need to avoid the middle of this range around 1800.
The best trades we get today will be at the highs and the lows of this range, so be patient for those levels to be tested.
————————
Euro Futures have the same price structure as the gold, so we are selling as price rises, buying as price falls and avoiding the middle of this range.
If price rises im selling the wedge highs and the PHOD 1.3738 as well as the resistance levels above the wedge.
If price falls im buying at support, buying at the lows of the wedge and the PLOD 1.3590. Im buying the support below the price wedge all the way down to 1.3500
If price trades sideways i need to avoid the middle of this trading range, the best trades today will come at the highs or the lows of this range.
845am est
Crude Oil Futures are also showing similar price structures ahead of the FOMC Announcement at 215pm today.
· Price Wedge
· Inside Day
· Sideways Range
My plan of attack is very simple, buy the lows, sell the highs, avoid the middle. Expect to see failures at the highs and the lows, assume fake-out breakouts.
As price rises im selling resistance levels at the highs of the wedge, the PHOD 87.68 and the resistance above the wedge.
As price falls im buying the support levels at the wedge lows, the PLOD 85.59 and the support levels below it.
If price trades sideways im avoiding the middle of the range around 86.50
915am est
Russell Futures have 3 price structures, similar, but different than the previous three markets we’ve prepped for today.
· Price Wedge
· Sideways Range
Difference is…Outside Day, possible Inside Day which is not the same as the others.
As price rises im selling the wedge highs and the PHOD 708.3 and selling the resistance above the wedge.
As price falls im buying the lows at support, buying the wedge lows and the PLOD 685.0
If price breaks out lower than PLOD we then turn OUTSIDE DAY, which means the sellers are in charge and we look to sell new lower lows with retracements.
As price drops im keeping an eye out for price reversals, and looking to buy the wedge lows around 665.8
If price goes sideways I need to avoid the middle of the range and the BMT at 688.5
——————————————————–
Questions for today….
When do we move our stop?
– When we see the 3 signs of a price reversal
– Momentum
– Speed
When trading the e-mini’s do we use the same trade management?
– Yes, this method works on ANYTHING
– I only trade the Russell of the e-mini’s
– ES = too liquid and too sluggish
– YM and NQ = are only $5/tick
o Cost me $5usd / trade
o Would i rather make $10/tick
o Or $5/tick
Example…..Joe’s Hotdogs:
I buy my hotdogs for $1
Which makes me more profit in the LONG run?
$10/hotdog or $5/hotdog?
———————————————————
Big Money Levels:
TF / GC / CL = 5 contracts
Everything else is above 10 contracts.
Euro, ES, FESX, Bonds Highly liquid
———————————————————
How much do you need to start?
$2,000 is the most efficient minimum
$500 minimums on the TF and Euro, however, that is a very tough place to start.
———————————————————
Swing Trading method is in the advanced course, watch the video and use the notes.
———————————————————
What makes the market easier to trade?
“look at the total volume”
@ 330pm EST I saw the TOTAL volume was finally high enough to get me trading.
@ 330pm there was NO MORE VOLUME in the market.
———————————————————
BMT = Big Money Trigger Line
– Where the BIG MONEY looks for support and resistance
– Makes a HORRIBLE entry location (sloppy and price magnet)
– Makes an EXCELLENT final target
