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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures -- Ignore unavailable to you. Want to Upgrade?

To: shasta23 who wrote (40539)	2/8/2000 4:37:00 PM
From: Michael Watkins	Respond to of 44573

Stefan, Hello there. Well VIX wasn't a great signal for today's action, that is for sure. I think Monday's pull back in VIX was a bit of a sign that any good news would power the markets up. The action on the spoos yesterday certainly was inconclusive; today's action frankly I don't think was that conclusive at all, just normal jump on kindly eco news (while it can). I try not to think too much about why things happen anyways... just that the read yesterday was not condusive to staying short the market overnight. Likewise, today's trading action in a vicious chop, with TICK underwater most of the day -- well, aside from a potential pop in the morning I dont see any reason for making a big market long position call either. Once the market starts trending then we can see what to do. As for the INDU, I don't follow it much except in a big day (either direction) I will watch it with the corner of my eye since I know the public is watching the DOW (although perhaps more the Nasdaq these days). But I think the DOW has people's attention, so big moves ought to be watched at least, if not acted upon. As far as methods, yes I have adopted Teresa "She Said" Lo's methods - I think the 1-2-3 trend reversal detection approach / identifying ranges (and staying out of most of them!) / and buying/selling retracements when the market is trending - well I think those are excellent and save methods. I traded the chop Monday much to my embarassement. I need to be slapped around when I do stuff like that! The initial opening moves Had fun with and then bounced around with other traders in aimless and account sucking crap... Taking profits too early is detrimental but so is outstaying your welcome. Clearly you need to be setting appropriate targets for the time frame you are trading in. I.e. don't look at support or resistance on a 15 minute or daily chart as your target if you are trading 5 setups based on 5 minute bars... you will get murdered. Once you have spotted first and second targets, suggestion would be to use the Dunnigan bar count method (check the FAQ on ispec) - and if you are trading multiple contracts, take profits on half when you reach the first target. and on all if Dunnigan says get out. Personally I always exit if there is a big expanded range bar - it may continue on from there, but there is usually a snap back (like a rubber band) that another buy/sell can be positioned on. Take care and good trading... Michael