While I consider myself to be primarily a futures index trader, how could I not pass up the thought that as the indices chop it up at their highs, Crude Oil has been sinking to a low not seen since 2007-09. As I am truly enjoying filling up my gas tank with prices below $2 per gallon, I have to wonder how long this may last and at what point a turnaround come. What will it look like? How do I get in with a lower risk entry? The twitter feed is surely burning up the airways as traders get antsy at these lows and highs on the inverse trading ETFs.

As crude futures near a point of downward resistance, it may occur to us crumb traders that eventually price will rocket or chop its way back up. The key is finding signals that indicate a tradable bottom that align with your risk and timing.

Since the four equity major indices turned upside in mid-October to new all-time highs, all we have managed to do is chop at the top. I couldn’t tell you what the exact bottom was in October because I was managing my trade downside and working to identify the change in trend to reverse positions. We may have a similar situation approaching on the oil ETF’s and ETN’s. I couldn’t tell you when that may happen as price could rocket higher, have all the crumb traders on board and then tank once again. Or just continue lower without much of a rally. That’s the risk we take as traders when fishing for a bottom. And that’s why we always use stops and have a plan.

To keep it simple, I want to share some potential setups regarding Crude Oil. Traders may not catch the absolute trading bottom, but I believe that the probability of success will be increased if one looks to enter a trade based on the setups, indicators, and steps highlighted below.

Looking for Positions to go:

Long: USL, USO, DBO, OIL, OIH, OLO, UCO, UWTI

Short: SCO, DTO, DNO, SZO, DWTI

Step 1: Watch crude on the daily chart. Key levels that I am watching: 49.9, 46.83 and 33.20 downside.

    Current price action on crude: 48-49.

Confirmed downtrend since 8/4/14.

11/21/14 was the last indicator of possible turnaround with no follow through.

If price action were to find a low at the end of today’s session, a price break and close above 59.9 would be signs of a confirmed uptrend. Full confirmation of an uptrend based on my trading strategy may not be until around 70 which may cause one to wish they had gotten in lower. If price action were to continue to drop, these levels would be lower. So are we at that point that price has found its bottom? Should I just go in blindly and place a trade in the reverse? Surely you could and roll the dice to see how your trade shakes out.

I’m not one to look at the markets and say that they are oversold or overbought. Often times, traders will get caught up in that mindset and then price continues to move in that same direction and they get cut out of the trade early (or take larger losses) because of some fallacy the market wants you to believe in. What would then increase my probability that I have a trend and not get caught from a blind entry at this current time?

1.  Look for two daily bars to cross over the 8 period moving average – This would be the absolute riskiest entry but a confirmation of the start of a possible turnaround. Place a stop below bar #1 or #2 based on risk level. As seen below when CL initiated its downslide.

2.  Heikin Ashi bar in trend with solid body and shadow/tail – Reinforcing the direction of trend and eventually a way to manage the trade for the long term.

3.  5/34 moving average crossover – Trend indicator of the 5 period moving average crossing the 34. Most ideal if Steps 1 and 2 above where to all happen at the same moment of the MA crossover.

4.  5 above 13 above 21 above the 80 period moving average – The strongest of trend indicators that if in unison will confirm the direction. As seen here on entry downside in August of 2014, always remained in trend in combination with HA bars.

Consider also watching for price and momentum to be in unison. If you miss the initial entry, a pullback on an intraday basis can offer another opportunity. When all trends line up on a daily and intraday basis, the probability of it continuing in trend is more likely.

Once I have confirmed what I believe to be a technical setup to the long side on the futures CL, follow through on any of the positions, whether long or short on the ETF’s and ETN’s, may all be managed using the same strategy. Best and ideal setup will be consolidation at the lows and an intraday setup that follows the same strategy posted above for entry.

Timing is key. Traders want to decrease risk, while increasing probability. Thanks for reading and trade safe!

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Trading Setups: It’s All About The Oil appeared first on See It Market.

While the state of the union may have been addressed in January, as we approach the end of the 1st quarter if trading in 2015, I want to take some time to craft a four part series reflecting on each of the major stock market indices. This isn’t necessarily to lay out a forecast for exactly what’s going to happen next. And since the major opportunity to go long presented itself weeks ago, the question now is what to do and how to manage positions as the market taps the highs on all four stock market indices.

After correcting in October and rebounding into year end, investors have been navigating choppy waters for the past several months. The first potential opportunity that appeared to lift the market in 2015 quickly turned down before resetting itself once again for the run higher we’ve seen over the past few weeks.

As seen below, the overall market picture has lifted to all time highs but low volume persists. Can we go higher on low volume? It’s certainly possible, as markets have done this repeatedly. But we are definitely at an important crossroads. Let’s examine some key charts and the paint a picture of the current state of the e-mini Russell 2000 futures (TF) and what roadblocks are ahead and what support lies below.

RUSSELL 2000 E-mini Technical Analysis Screen Grid

Top row (L to R): Daily chart (24hr), Daily Heikin Ashi with a 5/34 EMA, Daily Chart (US hours only)

Bottom Row (L to R): Weekly Chart, Monthly Chart, EMA (No Bars) 5, 13, 21,34,80

Now let’s dig in to the various time frames and indicators to see what’s happening. Below is a daily chart of the Russell 2000 futures (TF).

Russell 2000 E-Mini Futures (TF) Daily Chart – US Trading Hours Only

This chart include an 8 and 50sma. The price action here can be seen hitting the Fibonacci target #1… which was an 85 percent probability from the entry after price action closed above the 8sma on 1/21/15 with a stop at 1146.5 (that was never hit). That’s a tremendous trade for any swing trader. With price action now at fib target #1, a trader could take gains on this hypothetical trade and move their stop up to break-even, pocketing gains and staying in the trade.

Any concerns that price action may come back down? Perhaps the fact that volume that has gotten us up to this level and 1 day fade on lower than normal volume can bring us back down. Price and momentum are waning and could be the start of a down move or slight correction. Momentum is something that can turn back up, but I’m more concerned with is the open gap that sits below at 1173.5. See the chart below.

Russell 2000 E-Mini Futures (TF) Daily Chart – US trading hours – Open Gap @ 1173.5

Does this mean that before we go higher we need to close the gap? Nothing says that this needs to occur now but eventually all gaps get closed. With low volume on the price increase, any weakness makes a good case to go close the gap prior to going any higher.

Now let’s zoom out to the monthly chart and get some macro perspective.

Russell 2000 Futures (TF) Monthly Chart – Fibonacci Targets – 8/50/200SMA

Taking a look at the monthly chart, you can see the target above at 1264.9. If we would have entered based on the system I follow (back in October of 2011) a trader would have achieved one Fibonacci target after another with the same trade management tools of a weekly or daily chart to keep them in the trade. With the monthly chart supporting the continued gains in the daily charts, a move of 300 stocks to the upside is viable.

Fibonacci targets and levels are all good for management of the trade, but the strongest indicator that this drive is in trend lies in the Heikin Ashi bars and Moving averages.

Russell 2000 E-Mini Futures Daily Chart – 24 hours – Heikin Ashi – 5/34 EMA

Heikin Ashi bars, an indicator that trend is in play, can be seen here on a daily crossover that setup on 2/3/15 and has remained in trend ever since. With the evidence on the daily chart of hitting the Fibonacci target, HA bars can be seen here still in trend to the upside with hesitation at the top as indecision candles have formed. What would keep you in the trade to the Fibonacci target? Simply observing the daily bars as they remain in trend.

To support the HA bars, the second preferred indicator to show that price action remains upside are the moving averages.

100 Tick Range Chart – 5/13/21/34/80EMA – Bars Removed

As seen here above, the longer term trend has given opportunity for re-entry on pullback if the 5 to the 13 or 21 ema as price action continues upside. With the 5 ema now juxtaposed to the 13 off of price action continues upside re-entry above the fib target with the moving averages to keep you in trend. Clearly the evidence of the moving averages on a 100 tick range chart continue to remain upside. Sure the HA bars pause is of some concern, but I don’t see any reason as of yet to see the trend reversing.

So where does this leave the intraday and long term trader for the highest probability trade?

On an intraday basis, the trade to the long side would be triggered by a combination of Fibonacci setups in conjunction with moving average crossovers. And it would be strengthened once the price action cleared fib target #1 at 1237.8. Best supporting move will be on a Heikin Ashi bar that has a solid body and tail up configurment.

From a longer term view, price action breaking above 1237.8 and closing above on a daily chart, and support of the 5 ema chart, may just move the TF up to the next monthly fib target at 1264.9.

I also want to reiterate the two facts that may prevent price action from moving higher at this point; an open gap below and low volume that has pushed price to fib target #1. We are also nearing the end of the first quarter contract which can add some volatility into the market.

While I may not have the crystal ball to know what lies ahead, knowing the big picture allows me the opportunity to take intraday trades on a higher probability with the direction of the trend. Note that I personally trade the TF on an intraday basis, in and out. So I don’t hold long term.  My next article will look at the state of the e-mini Dow futures (YM). Thanks for reading.

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post The State Of The TF: What’s Next For The Russell 2000? appeared first on See It Market.

In continuing our series on the state of the major indices as we near the end of the 1st quarter, we will now take a look at the Dow Jones futures via the e-mini contract (YM). Similar to the e-mini Russell 2000 futures (TF), the opportunity to get long was several weeks ago. But that begs the question of what to do now and how to manage positions going forward? This becomes more difficult when we consider that all four major stock market indices recently tapped new highs.

After correcting in October and rebounding into year-end, investors were greeted with more stock market choppiness. The first potential opportunity that appeared to lift the market in 2015 quickly turned back down before resetting itself once again for the run higher that we saw in recent weeks.

As seen below, the overall stock market picture has lifted to all time highs but low volume persists. Can we go higher on low volume? It’s certainly possible, as markets have done this repeatedly. But we are definitely at an important crossroads. Let’s examine some key charts and the paint a picture of the current state of the e-mini Dow Jones futures (YM) and what roadblocks are ahead and what support lies below.

Dow Jones Trend Health Charts

Top row (L to R): Daily chart (24hr), Daily Heikin Ashi with a 5/34 EMA, Daily Chart (US hours only)

Bottom Row (L to R): Weekly Chart, Monthly Chart, EMA (No Bars) 5, 13, 21, 34, 80

Very similar to the other three indices, price action on the Dow Jones futures contract has continued to move upside on an 8sma crossover of the 50. Note this left behind an open gap at 17295. And with no Fibonacci setup, this drive upside on very little volume leaves a bit of caution. That’s correct, open gaps eventually get closed. So where is it best to remove contracts before price action may come down. It appears by all means to be a fantastic momentum drive, but is it enough to continue higher… or are we set for a pullback?

If the YM is set for a pullback, this could be a reflection on a good number of the Dow 30 stocks to pullback.

E-Mini Dow Jones Futures (YM) Daily Chart – US Trading Hours Only

With no current setup on the daily chart for a manageable trade on a Fibonacci setup, I turn to the weekly big picture. As you can see, the YM has been relentless in its pursuit to the upside. It’s been pretty methodical in taking a pause to find support and resistance at each level before continuing to the upside. For the long-term trader/investor, that type of action is a gold mine: wait for the initial pullback and enter on the first technical candle break above the 8sma.

But that’s all hindsight now. So how does that help the current trader who either wants to get in or manage their positions on the way up? With a higher potential target on the YM at 19717, the urge to get all caught up in this bull is tantalizing. But is there enough evidence to have a clear road map higher?

E-Mini Dow Jones Futures (YM) Weekly Chart – Fibonacci Targets – 8/50/200SMA

With the weekly Fibonacci target sitting much higher at 19717, our shorter-term target actually resides on the monthly chart. It currently sits at 18501 and will be a good probability yardstick for reaching the next target higher. As seen in the chart below, entry after an initial pullback and cross upside over the 8sma has been a very profitable trend trade. And considering that 18501 is the closest target, traders can use this level as an opportunity to enter (or add) to the trade once price action breaks and holds above 18501. So whether looking for the short-term target or the longer-term target, we have a road map of how we get to higher levels. So where is the optimal entry?

E-Mini Dow Jones Futures (YM) Monthly Chart – Fibonacci Targets – 8/50/200SMA

So as we have seen, the Dow Jones Industrial Average (via the e-mini – YM) is in a strong uptrend. But if you missed out on the move higher, the chart allows for re-entry on a 5/34 EMA crossover to each upside Fibonacci target.

As well, Heikin Ashi bars allow the trader to identify the trend and remain in the trade by removing emotion. It allows traders to focus their energy on managing the trade.

Daily Chart – Heikin Ashi – 5/34 EMA

Now let’s look at the moving averages chart below. It’s notable that the 5 ema (top line) has crossed downside of the 13/21 and 34. Watch for the averages to return upside for any entry on the long side. Confirmation that the e-mini Dow Jones (YM) is continuing its uptrend comes when all the moving averages are moving higher without crossing. When this happens, and as long as HA bars are unison, then the price action will continue back upward toward 18501.

100 Tick Range Chart – 5/13/21/34/80EMA – Bars Removed

Where does this leave the intraday and long-term trader for the highest probability trade?

With the weekly chart target higher at 19717, and the shorter term monthly target at 18501, where is the optimal entry?

With the big picture trend still higher (until proven otherwise), looking for an intraday entry to the upside sets up for a higher potential of a continued move upside. What are some of those indicators to watch for? Intraday Fibonacci setup, moving averages in unison with HA bars to the upside on an initial $TICK above 250 to enter the trade. But this is for an intraday trader. A swing trader may want to hold off until a Heikin Ashi bar turnaround (solid body, tail up) after two days downside (3.3 and 3.4). That would target 18501 and allow a seasoned trader to remove half the contracts at a profit while moving the reat up to breakeven (to protect profits). Any crossover on the 5/34 EMA downside will delay the move higher. Crossover back upside will be an opportune time for entry.

I also reiterate the two facts that stand out that may prevent price action from moving higher at this point; an open gap below and low volume that has pushed up price to recent highs. We are also nearing the end of the first quarter contract, which may bring some volatility back into the market.

For more on the current state of the markets, you can read my state of the Russell 2000 post.

While I may not have the crystal ball to know what lies ahead, knowing the big picture allows me the opportunity to take intraday trades on a higher probability with the direction of the trend. Note that I personally trade on an intraday basis, in and out. So I don’t hold long term. But this same method works for swing traders as well. My next article will look at the state of the e-mini S&P 500 futures (ES). Thanks for reading.

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post The Current State Of The E-mini Dow Jones Futures (YM) appeared first on See It Market.

Nearly six weeks ago, I wrote a piece on the Dow Jones Industrial Average (DJIA), which you may find here. Here’s a segment from that piece:

“I also reiterate the two facts that stand out that may prevent price action from moving higher at this point; an open gap below and low volume that has pushed up price to recent highs. We are also nearing the end of the first quarter contract, which may bring some volatility back into the market.”

Since early March, the Dow Jones Industrial Average has struggled to break above a significant Fibonacci level. And with less than normal volume, it is no wonder that Friday’s selloff was just waiting to happen. What lies ahead is anyone’s guess: Half will get it right, and half will get it wrong.

What can make investors prepared is knowing where the TREND exists and waiting for good entry points. The futures sit on a pivotal point here as the price action is poised to go in either direction. Intraday or swing, the setups are treated the same.

Trading the DOW 30 or the options? Heiken Ashi combined with moving averages can keep you in a long term trend. Looking for an entry point? Keep it simple and look for the moving average crossover. Here you can see General Electric (GE), a Dog of the DOW, has been performing well for 2015 so far.

The following video recap of the DOW 30 Stocks, ETF’s and futures will provides an in-depth analysis of where each chart is setting up for a trend move along with key levels to be aware of. I look at each of the DOW 30 stocks and share my thoughts on directional probabilities based upon current trend.

Thank you for viewing in advance.

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post The State Of The Dow Jones Industrial Average – Video Update appeared first on See It Market.

Nearly 4 months ago, I wrote a research post on the state of the Crude Oil prices. Here’s a excerpt from that post:

“Consider also watching for price and momentum to be in unison. If you miss the initial entry, a pullback on an intraday basis can offer another opportunity. When all trends line up on a daily and intraday basis, the probability of it continuing in trend is more likely.”

Well, the trends began to align over the past couple of weeks for Crude Oil prices and several related ETFs and markets.

Question is, did you get in at an optimal time or are you waiting for a pullback? It’s all about having some patience and watching for a trend crossover. That will help you get in at an opportune time.

As we can see in the Crude Oil chart with Heikin Ashi bars (below), the trend has turned higher. And while pullbacks can occur at any given time, traders must be patient when looking for re-entry (and maintain good discipline with stops).

How do you optimize this strategy? Wait for entry after a pullback and use the Heikin Ashi bars to help put you in the trade with moving average crossovers. This can work for swing or intraday traders.

With a variety of options to choose from on the oil ETFS/ETN’s, the same scenario is analyzed and played out chart after chart in the following video analysis. Looking for the pullback on a smaller time frame will help to ensure that your timing and risk reward align.

In the video below I discuss the current trends of several ETF’s and futures. Hope you enjoy it.

Thank you for viewing. Have a great week.

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Are Crude Oil Prices Ready To Trend Higher? [VIDEO] appeared first on See It Market.

As a technical trader, I leave the fundamentals to the experts. This is why I enjoy the IBD for solid research – I can pair it with my technical setups for proper timing on entries. Fundamentally speaking, as per IBD groupings, Starbucks stock (SBUX) comes in at #1 in its group (Retail-Restaurant).

Okay, let’s look at the technical setup on the chart and see what the stock price is saying. The chart below dates back to the initial setup in late October, 2014 (100 tick chart).

Now let’s look at my check list of fundamental and technical happenings.

• Starbucks stock is fundamentally strong in value as per IBD ranking.
• The technical setup on SBUX continues to remain strong to the upside; per Heikin Ashi/Moving Average combo.
• Looking for entry? Wait for the 5ema to cross the T3 Moving Average and Heikin Ashi bar with a solid body/wick up.
• For better timing, look to the intraday chart with a shorter time frame (50 tick) and same setup as on the 100 tick range chart.

• Fibonacci targets continue to be reached, with 56.80 outstanding as the upper target.
• Looking to remain in SBUX for the long term? Use the 3Sig technique by Jason Kelly to review your investments per quarter (Value based and rebalancing on 3% continued growth).

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Starbucks Stock: A Closer Look At The SBUX Trading Setup appeared first on See It Market.

As a follower of the index futures intraday, one question I get asked frequently is, does my strategy apply to Stocks, ETF’s, Forex and can it be used on swing or long time setups. The simple and straight forward answer is YES.

In the example below, you will see that by applying a longer time frame, whether it be daily or range chart, offers multiple entry points with the same exact strategy used on an intraday chart.

JetBlue (JBLU)

A solid earnings report on Tuesday lead the way to a nearly 7% rise in JetBlue stock, as seen here in the IBD market wrapup for April 28. Using a combination of strong fundamentals with my technical setups, makes for a stronger setup. Though JetBlue stock is not #1 in its sector group, the fundamental/technical setup of a Cup and Base back in October combined with the TradingFibz strategy made for an entry that would have kept you in with Heikin Ashi bars (also offering several potential re-entry points)

Here’s the chart of the uptrend with the initial setup highlighted back in late October, 2014 (100 tick range chart).

JetBlue Stock Chart (JBLU)

Thanks for reading.

     Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post JetBlue Stock Chart: JBLU Riding The Trend Higher appeared first on See It Market.

When it comes to scouring for opportunities in the market, we all would love to find the next big company that will shatter all others. However trading has taught me that sticking to what you know best always works – in process and companies.

According to the Investors Business Daily (IBD), stocks in a base equal a great buying opportunity… especially if the fundamentals are strong. And so today, I want to share 4 chipmaker stocks that may offer opportunity if their overhead buy point is triggered. Note that each of these were highlighted in a recent IBD video.

The 4 chipmaker stocks I’d like to highlight are Skyworks Solutions Inc. (SWKS), Microsemi Corporation (MSCC), Intel Corporation (INTC) and Texas Instruments Inc. (TXN). And, as I said, all have buy points above their current price (as highlighted by IBD), so you’ll need to be patient and continue to do your homework.

While past performance is never indicative of future setups and performance, time and time again, my TREND strategy if timed properly can be an opportune timing in the market. This said, viewing the prior setups is looking for the same exact setup to the right of the chart and using the Heikin Ashi bars to keep you in the TREND.

Skyworks Solutions Inc. (SWKS)

With an IBD buy point of 102.87, current price action in a downtrend with HA bars in TREND. With a buy point above, traders should wait for the 5ema to cross the T3 and the Heiken Ashi bar to be a solid body, tail up. Stop at the most recent swing size low. Entry will likely be below the IBD buy point and in TREND.

Microsemi Corporation (MSCC)

With an IBD buy point of 37.51, current price action nearing a 5 ema cross of the 34 downside, and T3 in a downtrend I am inclined to say that traders should stay out or remain short – this is nowhere near a buy point. With a 94 IBD composite rating strength, this chipmaker stock should follow to the upside eventually. The setup will be on the 5 above the 34ema and crossing the T3 moving average. The Heikin Ashi bar should be like prior entry with solid blue body, tail up.

Intel Corporation (INTC)

With an IBD buy point of 37.51, prime time to be in this stock. Entry may be forming now on a 5/34ema cross and Heikin Ahsi bar to the upside. Stop at recent swing size low. Watch overall market conditions as Intel’s IBD composite rating is not as high as other chipmaker stocks (with a score of 81).

Texas Instruments Inc. (TXN)

With an IBD buy point of 60.09, a downtrend in play with a previous 5/34 cross to the short side, yet the Heikin Ahsi bars are in TREND – this leaves room for a turnaround if the breakout point occurs. Stick to the strategy and wait for the 5 to cross the 34ema upside and T3/HA bars to be in TREND to the long side.

Remember to always trade with discipline. The best of trading to you.

Follow David on Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Four Chipmaker Stocks That Are Basing: INTC, TXN, SWKS, MSCC appeared first on See It Market.

As a primary trend trader with a focused strategy of looking for higher probability setups, I often find myself sharing my two sense on charts and market trends. Today I will focus on the S&P 500 and its current trend.

Earlier on StockTwits, I viewed a 20 year monthly chart of the S&P 500 posted by a fellow member of the community. I couldn’t help but appreciate the technical presence of what appears to be a repeating pattern of both price and market internals.

The question that all investors have now is whether the stock market is set to push higher or is it at the end of another bull market drive higher and ready to pull back? And perhaps more importantly, how can I identify the beginning of new trends and profit from the timing?

Chart source: StockTwits

In an attempt to answer questions around where we are at in the trend, let’s take a look at the same time frame and apply my strategy. We’ll use the same exact same scenario but with less indicators. No MACD. NO RSI. Just two moving averages. Each portion of the S&P 500 chart below colored in GREEN identifies a market in a long TREND. And vice versa each portion in red identifies periods of heavy selling. The green color coded area also correlates to the rising wedge seen above. As soon as the market broke the wedge formation, as seen below, it turned the cloud RED. Market timing on a moving average crossover combined with a color cloud and Heikin Ashi bars allows traders to follow the trend until the trend ends.

As you can see in the chart below, we are still in an uptrend (see green background). No turnaround is set in motion until the background turns red, indicating that my T3 moving averages have crossed. Until that point, what market levels am I watching on the upside?

Since we have just ended the first half of 2015, let’s look at a monthly zoom chart of the S&P 500. As you can see, the moving averages are in proximity of one another may give me reason to tighten up any stops I may have in related equity markets. Does this mean that they will trigger? I have no clue. That’s when we simply rely on good trade risk management.

This allows me to set some prospective targets using Fibonacci extension lines. This simply helps identify prospective price targets.

There are never any guarantees in this business, but as long as price action, combined with moving averages are in TREND, the S&P 500 may be targeting 2209. Any level below will now become a level of support if/when we do turn south.

It is the use of simple indicators that can put you in a technical setup from the start and keep you in for longer. The more you add to your charts, the more you hesitate from entering. Keep it simple Jedi traders. Identify the start of a trend and learn what it takes to remain in it, with the simplest of tools. Thanks for reading.

Twitter:  @TradingFibz

The author has no positions in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Charting The S&P 500: End Of The Trend Or Higher Prices Yet? appeared first on See It Market.

Recently, I started using Market Profile in my day trading analysis. It serves to provide a useful adjunct to trend analysis and the probability of market direction. While I think a basic understanding of Market Profile is helpful, teaching the fundamentals of Market Profile is not the point of this article. I simply want to work it in to our analysis and use it to complement current tools that help to keep us in the trend.

Utilizing Market Profile may be most useful in recognizing where the value area may lie on any given trading day. What stands out for me at the end of any session is not what occurred during it, but what still remains open at the end. To what “open” do I speak of?

Open Daily Gaps and Open Points of Control for regular trading hours (RTH).

A daily gap identifying the settlement close of the previous day. On many days, price action will tend to close the daily gap and then proceed in any given direction. There are also those days that the daily gap never gets closed and price runs in the opposite direction. By simply looking at any daily chart of RTH, you will notice that all open daily gaps eventually get closed.

A similar setup that occurs on a daily profile is the open point of control. Each day, as price action closes out on the Market Profile, it leaves a distinguished line; the point of control. If price action continues the next day in the opposite direction, like the open daily gap, it leaves us with an open point of control. Similar rules apply; by simply looking at any daily chart of RTH of the market profile, you will notice that ALL open points of control eventually get closed.

To explain this visually, let’s use the Nasdaq (NQ) futures. Seen here, since 6.29.15, while price action moved away from several open points of control, it eventually closed it out. Whether it took 1 or 6 days, price found its way to finish up business below or above.

Again, let’s look at the chart below as an example of open points of control that were never closed (represented by one blue line above and three below). This doesn’t necessarily mean that the price action will close it out on any particular day, it simply identifies one level above and three levels below that eventually, will get closed.

So how does this information assist me as an intraday trader? Knowing that it eventually will get closed, price can turn upside and close out the line above before turning downside. Better yet, how does it help determine the current TREND of the market to see if the point of control will get closed? Would it be that easy to short the market knowing I have three open points of control below?

By itself, the market profile is not enough.

This is where I add in my TREND strategy that utilizes moving average crossovers. As seen in the chart below, the two upper T3 moving averages on a 50 tick range chart crossed awhile back including a 5/34 moving average crossover study below. The combination of these two moving average studies clearly identifies a downtrend in the market that has been closing out the open points of control as seen in the charts above. Identifying this on the bigger picture, allows traders to remain in the TREND for that much longer. They also know that there are open points of control that have yet to be closed.

While price action has turned slightly upside at this time, the probability of the downside move will be greater once the moving averages are in unison in TREND.

When asked what direction I believe the market is headed, truth be told, I have no clue. When I see a trend on any given day, both directions work for me without bias. However, I take note, that with a moving average crossover that has been a clear setup to the downside on the bigger picture; the intraday setup is that much more likely and probable of leading in the direction of “unfinished business” – closing out points of control (chart below of downside trend on 8.6.15). With the larger time frame confirmation of TREND direction, the smaller intraday frame adds the additional confirmation of TREND towards the open point of control.

A Simple Strategy

Identify your open daily gaps and points of control. Know that eventually ALL open gaps/points of control will be closed. Intraday trades that are setup in the direction of the TREND of the open level have a decent but never 100% probability of closing out. Know that if price does close it, price may tend to fade/bounce off of it.

If you are interested in learning more about Market Profile, I recommend reading the CME document and two additional books on the topic by Steidlmayer and James Dalton.

As for where the market is headed on the NQ futures – let’s finish business below and go close out the open points of control. Till then, I’m always ready in both directions.

Twitter:  @TradingFibz

The author does not have a position in any of the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Using Market Profile For Trend Trading: A Nasdaq Futures Study appeared first on See It Market.

Many investors may not like to hear this, but I think the market will retreat.  Why do I say this and with what guarantee?

The truth is that I have no idea of when it will happen but the probability of it happening is increasing as time prods forward. And I think it will turn soon and head back to the short side on multiple time frames (see below).

Does this mean there aren’t any opportunities on the long side and that you should stay out of the market? Absolutely not. However, eventually the stock market futures indices will close what I call the Open Daily Gaps. This would also include any open gaps on the the ETF’s that associate with the major futures indices.

Just to clarify, I am talking about regular trading hours. This is where the volume is and that is why I like to use regular trading hours (RTH) charts. The ETF is restricted to those hours and thus the picture is the similar.

So What does this look like?

Let’s do a quick comparison of the 24 hour futures chart to the RTH chart.

In the chart below, we have the $ES (S&P 500 e-mini) 24hr futures. Note the area that has been shaded.

Now let’s look at the same time duration, but with a regular trading hours (RTH) chart. Note the open gap that now exists between the two sessions. Again, this is termed an open daily gap and is marked on my charts. In my opinion, open gaps like this one will eventually be closed.

As stated above, I keep my charts set to RTH as I believe that this is where the majority of the volume sits on any given day. And the open daily gaps assist with my risk management.

Does this work just on futures or can it be applied to the corresponding SPY ETF?

As seen below, side by side, the S&P 500 ETF (SPY) on the left and ES futures contract on the right, both have existing open gaps below. Note that they both closed out the top gap. I believe that the market will eventually retreat and close out the open gaps on both indices/charts.

Now there are articles and naysayers that will say, not ALL daily gaps get closed. I would even agree with that. However I stand firm and can guarantee that price action will retreat and close out, what I frequently call, downside business or as know here; the open daily gap on the indices futures market.

So as promised, some numbers.

ES – S&P 500 Futures: 1943 / SPY: 205.25; 195

NQ – Nasdaq Futures: 4552; 4262.5 / QQQ: 109.71; 104.1

TF – Russell 2000 Futures: 1113.5 / IWM: 110.63

YM – Dow Jones Futures: 17401; 16379 / DIA: 174.8; 164.58

What is the likelihood and at which point may these open gaps be closed?

At the end of each week, I wrap it up with a weekly recap and probability factor of where price action may lead over the coming week. Based on a bit longer-term charts (see below), I access probabilities. Adding in the intraday charts can either increase or decrease these percentages. When bias forms to the downside, percentages above 75% in the RED will be a good indicator that we are headed to close the gaps.

You can find my videos posted weekly on my Website or YouTube channel. That is it. No deep explanation. It’s a simple as…ALL futures indices daily open gaps eventually get filled.

Thanks for reading.

Twitter:  @TradingFibz

The author trades these indices intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Are Stocks Set To Reverse Course? Watch Those Open Gaps appeared first on See It Market.

In my mind, it’s as simple as ALL futures stock market open gaps eventually get filled. It just takes patience and a system that works for spotting trends and reversals (trend changes).

Those are the words I left you all back in November 2015 when I was forewarning of a coming pullback for stocks. I also proposed that not all investors would want to hear the gloom of markets turning down and so my partial words of wisdom may have simply been put on the shelf with all the other naysayers.

Truth be told, I had no guarantee when it would happen, but that eventually the probability was increasing.

As a contributor to market analysis, at the end of the day the market is a 50/50 split for those that get it right and those that get it wrong. We write (and trade0 with probabilities. And we use them to assess risk that the market will head in a certain direction. For those of us who got it right, we wave our flags high and inform you all that we knew it all the time.

So it’s a lot easier taking a macro approach and applying a trend following system to it. And my approach is that all stock market open gaps (for major indices) eventually get closed.

And building off the prior article, I’m writing today to inform you that we closed them in the first week of trading for 2016.

Starting out the first week of 2016, it was the TF (Russell 2000 futures) in retreat that started what was to be a following by the other three major stock market indexes.

The open gap on the Russell 2000 futures in regular trading hours indicated by the shaded area back in November was an area by all means that would eventually be closed. BUT, by no means does this mean that opportunities did not exist in the interim, though.

At what juncture did the probability increase that these stock market open gaps would close?  Let’s start with the Russell 2000.

Based on a bit longer-term charts (see below), I access probabilities. Adding in the intraday charts can either increase or decrease these percentages. When bias forms to the downside, percentages above 75% in the RED will be a good indicator that we are headed to close the open gaps.

As seen here, on December 8th, 2 out of the 6 charts that I observe, clearly had shifted to the downside indicating an technical bias that may lead to close out the open gap. While the longer term charts had shifted to the short, it was the short term swing charts (4 hour) that had the next leading bias only to be followed by the intraday setup.

With all 6 charts in sync to the short side, it was at that time that the market had the greatest probability of closing out the daily open gaps.

As seen here on a chart for the Russell 2000, one of the key stock market open gaps was closed on the left by the price action on the right reaching 1109.4 and closing out the “gap hole” that existed for three months.

What about the other three major stock market indices?

4 days later, the ES mini S&P 500 futures closed out it’s open gap from October 5.

In sync with the ES, the Dow Jones futures (YM) closed its Open Gap from October 5.

The Nasdaq 100 futures (NQ), on a last attempt in the last hour of trading for the 1st week of 2016 came within several points of closing out its open gap. Note that this open gap was closed in early trading this week.

Knowing now that we have closed these major stock market open gaps, where does that leave us and what may come next?

Before we get ahead of ourselves, it’s good to note that the market still has room to move lower on all 4 stock market indices in conjunction with market and volume profile open points of control. We know the market to never move in one direction without price retracement and an opportunity to buy in an area of value may currently exist.

Whether we continue lower or not, one thing is for sure. We now have left open gaps to the upside that will all eventually be closed out. But we have to be patient and wait for a trend change before we target these stock market open gaps.

       continue reading on the next page…

The post Stock Market Open Gaps Get Filled: Now What? appeared first on See It Market.

The Index Futures Market – Big Picture 

I always find it helpful to go back to the prior trading week and review the setups and what happened. Sometimes taking a step back allows us to better see where the market is situated and where stocks may be headed.

I think this also allows for higher probability setups because we have a better idea of the overall market direction and particular trend. It’s your patience and discipline that will continue to grow as a trader when you implement such practice.

Okay, let’s start the review what happened and finish with a look ahead…

The Week Behind

One month down. Whew. What a ride it has been. After three weeks of selling, the futures market on Friday found some lift after consolidation at the lows. And this helped the various stock market indexes to rocket higher into week/month end.

It was a tough week for traders as the futures market was very choppy. We had to deal with FOMC minutes, GDP, global central bank action, and some big econ numbers. This send stocks chopping up and down all week.

While there are always ticks to be made on some nice intraday swings, we remain in a daily/weekly/monthly trend downside and the short term picture is neutral, in my opinion.

Daily gaps/open VPOC’s remain above and below the current price action – all viable targets on any given day. Fridays session appeared to be the breakout of the weeks consolidation, but follow through will be important for any short-term trade confirmation.

Highlights of the week continue to be the 50/144 ema chart that has guided the bigger trend in conjunction with other chart indicators. Whether it be a downside or upside target of choice, the T3 cross in conjunction with the 50/144 ema continues to be a force to contend with when wanting to remain in the trade for the long term.

Weekly Stock Market Futures Index Recap Focus – VIDEO

The Week Ahead

With the Futures market now rallying to the upside it appears that there may be room to move higher and close out upside open gaps and points of control. By no means does this indicate that the market may not drop back down, so use stops on short-term trades. We continue to close out previous days open gaps below which for the short-term shows a technical bias of support.

For the long term picture, markets clearly remain in a downtrend. The short-term picture has approached a bearish /neutral position on the 4 hour charts to the 144ema which can go either way. Decision time on the rally is likely coming this week. Crude Oil is finding support at the 144ema with no indication of a downturn to continue.

My Technical Bias leading into the first week of February:

Big Picture Index Charts and Crude

TF – Russell 2000 Futures

NQ – Nasdaq Futures

ES – S&P 500 Futures

CL – Crude Oil Futures

It’s been choppy out there so your safest bet with futures markets is to follow the momentum on any given day and keep things tight and short-term, or use higher level indicators and play small ball on longer term position building.  We should learn more about the market by week’s end. Until then, always be ready in both directions.  Thanks for reading.

Twitter:  @TradingFibz

The author trades these indices intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Futures Market Outlook: Will Price Action Confirm The Rally? appeared first on See It Market.

The Index Futures Market – Big Picture 

I find it helpful to go back to the prior week of trading action and review the setups and what happened. Sometimes taking a step back allows traders to see the market from 50,000 feet and better understand where stocks may be headed (and stock market futures).

I think this also allows for higher probability setups because we have a better idea of the overall market structure and trend. It’s your patience and discipline that will continue to grow as a trader when you implement such practice.

Okay, let’s start the review what happened and finish with a look ahead on key stock market futures indices…

Futures: Looking at the week behind…

Let’s focus on the Nasdaq futures (NQ). It was a volatile week of trading the NQ this week – and the other stock market futures indices, for that matter. The first week of February saw low volume Monday as the market action came down from the Friday “Bank of Japan” rally.

But it was quickly back into sell mode closing out the open gaps left from the week prior. Thursday’s price action was no doubt the toughest of the week with prices all over the place. It ended up being an inside day but set the stage for a trend day on Friday.

With all it’s volatility this past week, I had the best week ever on the NQ as implementing a modification as to how far I would let 2 contracts run before taking 1 off while using the 50/144ema to keep me in the TREND. The use of the fib projection and 96% projection levels have been welcome to the room as 4/5 days this week (TF 5/5 days) the levels were hit.

Crude Futures moved sideways this last week pushing both extremes after fading off the 61.8% fib retracement. Crude Oil has yet to find its way back upside to close out open gaps. All this amidst continued calls for price to come down as low as $7 by Deutsche bank!  The end of January had price regaining some traction upside but quickly fell back into the downward demise. The technical bias remains BEARISH on ALL time frames.

Equities: Market Cap Leaders

Starting Next week

Utilizing the same T3 strategy for stock market futures, I will look at the top 6 Market Cap Leaders and assess current market TREND opportunities for NFLX, FB, AMZN, GOOG, AAPL and SBUX. Whether you trade the options, swing or intraday position, the big picture will allow you to assess potential greater probability entries based on market momentum.

As a follower of @Jasonkelly for some long term strategies, I will begin in March every month to review some of the holdings that can be easily managed 4 times per year without concerning yourself over the intraday volatility of the market.

Looking at the week ahead…

Stock market futures indices are now fading back downside, in tow with key equities. The market is now back in a confirmed BEARISH TREND. Bulls will look to build value and point of control at Fridays lows. With a bearish stance going into Superbowl Sunday’s stock market futures open, it will take the overnight session to move us back upside on the Globex charts (50-100 tick and 4 hour T3 moving averages) to regain some Bullish positioning. Bullish momentum could continue if we break the 4 hour chart on a 50/144ema which we gave up this last week. Once we break that 144ema upside, open gaps above will be the short term targets for the market.

For the long term picture, markets clearly remain in a downtrend. The short-term pic is now in a bearish position on the 4 hour charts. We continue to close out previous days open gaps below with numerous open points of control on the NQ volume profile above the rest of the stock market futures indices. Crude oil now under the 50ema which can easily turn on a dime with news that production will be cut.

Technical Bias & Charts leading into the second week of February

        continue to the next page for more futures charts and analysis…

The post Stock Market Futures Weekly Update: The Big Picture appeared first on See It Market.

The Index Futures Market – Big Picture 

I think it’s helpful to go back over the prior week of trading action and review the setups that occurred. Sometimes taking a step back allows traders to see the market in slow motion and better understand where stocks may be headed (and stock market futures).

I think this also allows for higher probability trading setups because we have a better overall idea of market structure and trend. Your patience and discipline as a trader will continue to grow when you implement such practices.

Okay, let’s start the review what happened and finish with a look ahead on key stock market futures indices. Note that you can watch my weekly review video here.

Stock Market Futures: Looking at the week behind…

Six weeks into the year and these five days had volatility and flatness written ALL over it. Not just on the Russell 2000 Futures (TF) but on all 3 stock market futures indices. With Janet Yellen’s testimony on Wednesday and Thursday, price session overnight gaping down and never going higher made for some very tough sessions, especially for intra-day TREND traders.

Finding pockets of opportunity may mean waiting and waiting and waiting for the setup until everything looks perfect… and sometimes the trade still does a 180 on you. Yes, that did occur and is most likely the core reason for the majority of any losses this week.

However, when the trend did run this week, it made up quite substantially for any losses and the same premise will continue into this week.

A Quick Note On ETF’s

In conjunction with the stock market futures indices, ETF’s including Gold (GLD), US Oil (USO) and the Euro (FXE) are an opportunity to not just trade intraday but for the short to long term as well. Combined with the Jason Kelly 3% re-balancing can make for a very powerful strategy. Timing is everything when it comes to the markets and being ready for the momentum crossover can put you into a long term trade and learning how to remain in the TREND is the goal.

Equities: Market Cap Leaders

Utilizing the same T3 strategy for futures, I  review the top 6 Market Cap Leaders and assess current market TREND opportunities for NFLX, FB, AMZN, GOOG, AAPL and SBUX. Whether you trade the options, swing or intraday position, the big picture will allow you to assess potential greater probability entries based on market momentum.

Watch the video link above for a chart by chart walk through starting at about 22:00. Beginning in March I will also begin a FREE weekly newsletter that will include the weekly analysis of each of the mentioned above.

As a follower of @Jasonkelly for some long term strategies, I will begin in March every month to review some of the holdings that can be easily managed 4 times per year without concerning yourself with the intraday volatility of the market.

Stock Market Futures: Looking at the week ahead…

Hopefully not a repeat of this last week, price action lifting on Friday may give us a small rally if we can hold above the 50/144 on the four hour chart. As reviewed in the video, significant resistance now lies at the 50 day ema, and we will need to follow through to at least the 144ema before we see additional resistance. While upside open gaps seem to be a reliable short term target, it will be the combination of the Globex and intraday trend that will enable the market to lift higher. Weekly and monthly pictures remain in a downtrend.

Crude oil remains in a non-contested technical bearish trend. The only hopes at this point of moving back up into the 40’s would be on rumors coming true of production cuts. If then, open gaps above at 33.74., 36.71 and 48.74 will be in my scopes.

My Technical Bias & Charts leading into the third week of February

Big Picture Charts  as of the close of Friday 2.12.16

TF – Russell 2000 Futures

YM – Dow Jones Futures

NQ – Nasdaq Futures

ES – S&P 500 Futures

CL – Crude Oil Futures

Index ETF’s seem to also have their work cut out for them as price action on the 50/144ema chart is at key resistance at the 50ema. The Euro ETF (FXE), a great example for a breakout above the 144 is a prime example of what we are looking for in the US index futures. So watch for the reversal if we go up. Timing in GLD is overthinking and while the entry was some weeks back, another opportunity will arise. Watch the moving averages and my twitter posts for any change in trend.

My Technical Bias on ETF’s leading into the 3rd week of February

Thanks for reading and have a great week.

Twitter:  @TradingFibz

The author trades these indices intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Stock Market Futures Weekly Update: Short-Term Bullish appeared first on See It Market.

The Index Futures Market – Big Picture 

I think it’s helpful to go back over the prior week of trading action and review the setups that occurred. Sometimes taking a step back allows traders to see the market in slow motion and better understand where stocks may be headed (and stock market futures).

I think this also allows for higher probability trading setups because we have a better overall idea of market structure and trend. Your patience and discipline as a trader will continue to grow when you implement such practices.

Okay, let’s start the review what happened and finish with a look ahead on key stock market futures indices.

Stock Market Futures: Looking At The Week Behind

Two months down. Ten more to go. Not sure I can take anymore of this uncertainty.

Just kidding. This is the stock market. It’s all about uncertainty which makes it an adventure each day. Oh what an adventure it has been. Sell of January into rally February which has made the end of the month a questionable window dressing as we approach contract expiration or are things actually looking up?

In the end it doesn’t matter what I think or for that matter what anyone thinks. The bottom line is trading the charts in front of you for an intraday trader and being on the side with the highest probability of the setup continuing in TREND. To that fact, I was put to the test almost each session this last week on the ES.

With the Sunday open gaping up significantly on all 4 indices, , the chase was on to break through upside and go grab the 50 and 200 moving averages or turn south and close out the gaping wounds left from the previous Fridays close. The ultimate test was siting through and with much patience, waiting for the setup that would run. Which one would it be? Only and only when the charts lined up, would I enter. Where there setups that caught me? Sure! Where there setups were I was so set that price action would run? Sure. did they all work out? Nope. However the ones that did, paid off substantially in ticks and as a trend trader, regardless of which indicator you use to identify a strong trend, would have kept you in.

Stock Market Futures: Looking At The Week Ahead

Decision time.

With end of the month trading, contract rollover, price at key moving averages, open gaps above and below, FOMC meeting approaching….and the list goes on. Can make your spin head that you may never take an entry and that is why I leave it to the 50/144ema chart to guide me in the TREND on any chart on an intraday basis, regardless of the bigger picture. I could tell you that the market will be going up this week and I have a 50/50 chance of being right. Sounds like any guru out there. So….remember to leave your bias at the door and trade the charts in front of you and watch for key momentum levels. Overall technical momentum leading into the week is Bullish with support below to watch for @ the 50ema’s on the 4 hour 50/144ema charts.

Technical Bias & Charts leading into the first week of March

“Big Picture” Charts as of market close Friday 2.26.16

Russell 2000 Futures (TF)

Nasdaq Futures (NQ)

S&P 500 Futures (ES)

Crude Oil Futures (CL)

Crude closing out the open gap at 33.74 and now at the 50ema, still remains in a technical bearish trend on the big picture . Talking of  production cuts continues to move the market in violent swings in price. Price crossing over the 50/144ema with the trend still in the RED will be the key chart I will watch to see if there is any hope of upside momentum. Open gaps remain above at  36.71 and 48.74 will be in my scopes.

Combined with fundamentals and what you believe to be a price of value based on your own criteria, watch for at least the technical cross of the T3 moving averages on a higher time frame and the four hour chart to put you in good position. While I do not look for intraday setups, using the T3 strategy is useful as a trading tool in looking for momentum in price action and remaining in the trend. Whether you go short or long in the market, wait for the highest probability when ALL charts are in sync.

Until then, always ready in both directions.  Thanks for reading and have a great week.

Twitter:  @TradingFibz

The author trades futures intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Stock Market Futures Weekly Update: Decision Time appeared first on See It Market.

In some hobbit hole you have created in your abode with anywhere from 1 -10 monitors sucking the electrical gridline of your neighborhood each day, you are trying to squeeze out a menagerie of trades on any given day… yes, this is the typical life of a day trader.

It is a lonely business for the crumb traders of the world. You are just craving to etch out a “OH, WHAT A TRADE”… or in bad times, “WHAT THE HECK WAS I THINKING?” You turn to the right and left, and all that’s there is the dog who will love you either way and the house cat who doesn’t even care.

Try telling your mate, if one is around, and the response is…”oh., that is nice” or “oh, try again, you’ll get it.”

Yet, that is not what you need when your zoned in. You want to be around like-minded traders who are going through the same manure you do each day. A place to vent. A place to celebrate. A virtual world to actually feel you are going to the office but can leave at any time and wear whatever you want. Even down to the bare budonkadunks.

Many begin your search by talking with your friends at the local meeting investment group where the majority of them are content hiding in their hobbit hole and have no interest in coming out anytime soon. And many are afraid to share any of their so-called market secrets. The next best place in your search starts in Google with the words “trading rooms”… up comes a plethora of sites. They all look great and the search is on.

You want to see transparency.

You want to know that the traders in the room will be just like you.

You want to know the price of the room.

You don’t want to have to pay a fortune for a room that will cost more than your monthly profits.

You seek a balance of value and professionalism.

The time has come and now you have found a room that you are willing to try out. You seek an initial trial offer to get a taste. It looks great all up front. You decide to hunker down over the weekend to think about it and by Sunday afternoon, you’re welcome email in the inbox and you are ready to roll come Monday AM. This is it. You have a decent account size to start and are familiar with the platform that will be used in the trading room or at least are comfortable with the one you have been using for some time now.

Monday AM comes. Monday PM goes. One week gone.

It wasn’t what you thought it would be. You try it again for another week and it just doesn’t seem to be a right fit. You re-assess. Do you really need to be in a trading room? Perhaps you really are comfortable in your trading hole and are willing to spend your remaining days on your own. Nothing wrong with that.

If however you are willing to sit down for a moment and re-evaluate some essentials when it comes to trading rooms, you may be more open to finding what may work for you down the road when you do decide to be part of a bigger community.

Bare bones, No holds barred, No sugar coated reality check to being part of a trading room.

• Start by leaving the emotion at the door regardless of whatever room you may join. You need to harness the emotion of placing live trades.
• Don’t bring your trading “baggage” to a trading room.
• Sim it live until it is second nature and profitable.
• You trade 5 days a week? Join a room that is open 5 days a week. Open to close.
• Seek a room that offers a free trial for a day or up to a week.
• Don’t spend more than $100 a month without some end date for a reasonable full paid membership.
• Seek a room that has some personalization to it where the mentor/organizer actually notices if you are gone and contacts you.
• Join a room were questions and free speech is allowed with knowing that you need to be respectable to other traders.
• If seeking to developing a trading strategy with the trading room, take the time to actually learn the strategy, read the manual, watch the videos and WRITE down your trading plan.
• Focus on the process. Live it. Breath it. Observe the mentor’s process and learn to react to your setup versus simply clicking when the mentor clicks.
• Any supplemental templates or programs should be reasonably priced or part of your membership.
• You will lose money in the market. Don’t blame it on the market. Don’t blame it on the room. Don’t blame the mentor/organizer of the room. You pushed the button.
• You will make money in the market. Don’t blame it on the room. Don’t blame the mentor/organizer of the room. You pushed the button.
• Ask yourself this. If the mentor/organizer is not in the room or stepped out, did you hesitate in taking a trade? If you didn’t, you are a shadow trader. You don’t belong in a trading room. (I know someone may jump on this point and tell me they are successful shadow traders, but there will always be the what if…. and now you are back on your own.)
• You will fail if you want to shadow trade.

Jesse Livermore said it best.

“The average man doesn’t wish to be told that it is a bull or a bear market. What he desires is to be told specifically which particular stock to buy or sell. He wants to get something for nothing. He does not wish to work. He does not even wish to have to think.”

• Learn the strategy. Implement any part of it you wish to use. Stop trying to follow someone else as opposed to learning how to do it on your own. Learn to become the independent trader.
• Trade the charts in front of you, not on the screen share. Data feed may be different. Charts may be slightly off.
• The mentor/organizer may win the lottery the next day and close shop. Now you are on your own. Have you become the independent trader or you off to seek another mentor to shadow off of.
• Join a room where the mentor/organizer trades at a minimum a reasonable number of contracts that you would trade as well. In other words, don’t be in a room where 4 contracts are traded if you will never trade that amount.
• Not every room is going to work for you and you need to be able to walk away and find what works for you.

Many of you may remember a typical math class growing up was all shadow learning. When it came time to problem solving, many of us failed because we didn’t have the necessary tools after having for so long wanting to be told every single step along the way. Today’s math classroom has moved most of it’s core teaching to problem solving from the start.

Any good trading room may provide the essentials to learning a particular strategy. Most likely they provided those materials for a fee or nominal cost. You decided to take a short cut and simply want to be told what to do. Yes, even just waiting for that trade alert on your twitter feed.

Just like the old math classroom.

If you want to progress as an independent trader within a trading room, learn to problem solve within the context of the classroom and not ask for just the answers.

As there are a plethora of sites out there to join, just like any substantial purchase, do your diligence and homework to find the place that works best for you. Thanks for reading.

In full disclosure: David Katz runs a daily live trading room. Check out his website of twitter feed for more information.

Twitter:  @TradingFibz

Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post The Ins And Outs Of Joining A Trading Room appeared first on See It Market.

The price action is once again at all time highs for the major stock market indices. So, where do we go from here? Could a stock market pullback be lurking around the corner?

To actually consider that I would or for that matter, anyone would know where this market may be headed is simply a guess at best. This is why I tend to stay away from actually figuring out if we are headed up or down on any given day. Instead, I simply observe the stock market charts that are in front of me. I’ve found that it’s best to be ready for movements both directions intraday regardless of the larger trend in play.

Now this goes without saying that there will be those that speculate that the stock market will go up and those who will have a vision that it’s going down. Someone will get it right. The one who chose the direction in which the market headed will raise their uncanny ability to predict and the other party will simply slither back under a rock until the next opportunity.

So let’s put all the guessing behind us and look at where the major stock market indices are at. I’ll look at the current technical setup and what we can do to be prepared for potential moves in both directions.

With the market at all time highs once again, it is no doubt that a resistance of price will exist. In the wake of this move up on the post-Brexit vote, I believe traders should take note of the numerous open gaps… they will likely hound the markets in months to come.

The case for more upside in the major stock market indices

Is it possible that in a election year and with the proposal that the central banks are infusing money into the markets will keep the drive alive? Perhaps. From a technical perspective, price action holding above the key T3-50ema’s and 4 hour/daily and weekly charts all upside are the highest factor for me as a technical trader that the market remains in an uptrend. Fibonacci extension levels and NQ open gaps ahead can just be the catalyst for the S&P 500 (INDEXSP:.INX) or vice versa to continue the drive upside. Also, by the pushing off of any Federal Reserve decision may just hold us up as well. Leaving the bias out of the market means that regardless of your thoughts of why the market should short for more reasons than to keep it upside, is to simply focus on the charts in trend and momentum.

S&P 500 Index Chart  (INDEXSP:.INX)

The case for a stock market pullback (i.e. short opportunity)

With as many reasons for the market to push the highs, it also comes with the possibility for a pullback to at least the 50/144ema on the 4 hour charts or daily 50ma’s. Q2 earnings season may be the catalyst for the market to short if the numbers don’t show as expected.

From a technical perspective, the open gaps left in the trace of the post Brexit vote to the upside, are the highest probability that price action turns downside but only until the 4 hour charts T3 moving averages on a 10 tick range chart turn downtrend.

With the VIX Volatility Index at the lows of under 12 now, may be just what the market needs to start to indicate momentum on the SPX to slow down and reverse.

Keep it simple Jedi traders.

While it is my perspective that the market will likely see a stock market pullback, it is best to leave your bias at the door when trading. Simply watch the charts in front of you for the highest probability of price action in trend.

Thanks for reading.

Twitter:  @TradingFibz

The author trades futures intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Stock Market Update: Looking At The Weeks Ahead appeared first on See It Market.

With the buzz continuing to fly around on a oil production freeze by OPEC, it is not advantageous for either a long term or short term trader to get caught up in the news cycle. That said, if you are an active investor/trader, you also need to follow some key trend disciplines.

As crude oil prices continues to flirt and float within the $40-$50 trading range, it’s been offering intraday setups in both directions. That said, when the intraday trading action syncs up with the shorter term big picture, it becomes that much more powerful (in that direction).

The current trend (as seen below on a regular trading hours daily chart) shows the price action holding above the 50 and 200 day moving averages. This is a positive indicator for any short term holder/trader in any situation. But we can zoom in further to understand the strength of the crude oil trading trends.

To reinforce the big picture we drop down to a four hour chart and identify that crude oil prices are holding above the 50 and 144 period moving averages. This gives strength to the crude market holding strong to the upside. Once again, a positive notch for uptrend momentum.

When the bigger picture is stacked in your favor, it is the intraday setup that will get you in at a good risk/reward level. And once the trade is in trend (and in sync on an intraday and day level), it is more powerful to a swing trader.

With several time frames currently supporting strength to the upside, identifying open gaps where price action has left a hole is important. This is where markets tend to migrate. The overhead gap at 55/56 is a reminder of unfinished business. It doesn’t need to be filled now, but is likely to be filled at some point. With the uptrend in play, it is the hope of any short to long term holder that the 55.41 target may be the level that we breach next after numerous attempts over the last year.

Thanks for reading and remember to always use a stop at/around key technical trend levels.

Twitter:  @TradingFibz

The author trades futures intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Crude Oil Trading Update: Short-Term Trends Positive appeared first on See It Market.

THE BIG PICTURE – Stock Market Futures

Week 49 brought about a relentless pursuit of higher highs in the stock market indices. Nasdaq futures (NQ) soared back from its late November selloff to reach new highs. Stock market futures were also aided by the suddenly energized Dow Jones Industrials & Transports.

The rally in the Transports has helped the Dow Jones push toward 20K.

And the S&P 500 is also marching to higher highs. With the volume rollover now in the hands of the March Futures (ES) contract, it will be interesting to see the market’s reaction to the Federal Reserve meeting (which is most likely priced in already).  After such a big rally into December, is there any rally left for this week? Quad-witching at the end of the week will bring all volume back into March contracts. Who knows, perhaps this will bring an opportunity for the markets to take some profits after a big run up in week 49 leads us into week 50.

As always, leave your bias at the door of where you think the market should be. Watch the charts in front of you and stay away from the Z-Vals. Be ready in both directions. The trend reveals itself on Heikin Ashi bars and proper trade management keeps you in the trend.

Attempting to determine which way a market will go on any given day is merely a guess in which some will get it right and some will get it wrong. Being prepared in either direction intraday for the strongest probable trend is by plotting your longer term charts and utilizing an indicator of choice on the lower time frame to identify the setup and remaining in the trade that much longer. Any chart posted here is merely a snapshot of current technical momentum and not indicative of where price may lead forward.

NQ – Nasdaq Futures

Current Trend:  UPTREND

The daily chart has broken through to the other side. I highlighted in my midweek outlook that a move above the 50 day ema was all the index needed for higher highs to the 4882 level. With the majority of volume now in the March contract and with price action back above of the 50 day ema, price action rises into the 4902-12 zone before a pullback to the 4765 area. Don’t count out a 50% Fibonacci pullback or at least a close of the open gap set on Friday. Downside, price may have resistance as low as @ the hourly 50/144ema. To the upside, if price is able to break this zone, 4960 is my current high. At that level why not go for 5K on the futures!  Always watch the intraday charts for momentum of TREND on the Heiken Ashi bars.

Zones to Watch

Nearest Open Daily Gap: 4868.5

Lowest Open Gap: 4017

ES – S&P Futures

Current Trend:  UPTREND

Looking to the upside, the S&P 500 futures with a possible scenario of resistance at 2257 may be the first stall we get if price action is to lift. The current high of 2265-73 on the 4 hour chart would be a level to watch if momentum is to move in that direction. To the downside, 2242 may be the first pit stop if price is to hold around 2257 and turn down. Any further selloff would test the 1 hour 50/144ema cloud which could put the ES down to 2234. Watch for support at the 50 day ma. Probability is that we remain solid in the uptrend with several mini-pullbacks until we break below the 50/144ema on an hourly chart, retest the 144 on a pullback and head lower (starting downtrend). Note that the last pullback only lasted 5 days and never retested the 144ema.

• How to identify the opportune time for a pullback or trend change entry? Watch the higher time frame for levels of support or resistance as seen below on the MML chart, and in combination with any trending study or candles, remain in the trend. If for instance one wanted to trade/invest in the S&P 500 ETF (SPY) as a proxy for the S/P futures, the pullback to the oversold level was an opportune time, and on a lower time frame to scale in to the bounce off the lows. At this juncture, waiting for the next pullback would be optimal on a lower time frame (1-4hr) to the upside.

Zones to Watch

Nearest Open Daily Gap: 2197.25

Lowest Open Gap: 1860.75

Thanks for reading and remember to always use a stop at/around key technical trend levels.

Twitter:  @TradingFibz

The author trades futures intraday and may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

The post Stock Market Futures Weekly Review & Outlook – December 12 appeared first on See It Market.