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Wednesday, April 12, 2017

TIME & STOCK INDICES TRADING


“Easter week recipe for good mental health!”

A pretty low key day all around; nothing really to do with most market participants either in the Caribbean or wishing they were there. Look, it’s Easter week, and nothing usually happens, and you need no greater illustration of that than the daily candlestick [including today so far] directly below.





The only reason there’s a range at all is that overnight in Europe stocks caught a bid; but that soon evaporated, and with all the political [domestic & foreign] uncertainty, it’s no surprise to me things are/will be quiet until the Easter Holiday is over next Tuesday.


Time matters in stock indices; and what I mean by time is the time of day in relation to where the market is trading; for the most part, forget overnight. If you’re a “pajama” trader that’s great, but you won’t be around for New York; you can’t have it both ways and remain alive to tell about it.

During New York hours [9:30 A.M. – 4:00 P.M.], we are all familiar with the opening & closing shenanigans of mutual funds, pension funds, and large hedge funds that due their buying/selling in either the opening minutes or the closing minutes of trading. There is however one other significant part of the day that you need to pay attention to for maximizing profit; that is the Chicago Noon hour. This is the 11:30 A.M. – 1:00 P.M. time frame in Chicago, which is the 12:30 – 2:00 P.M. time frame in New York; it also happens to be 16:30 – 18:00 time frame on the Turnkey Forex server.

The importance of this time frame can’t be underestimated; here is the rule you need to follow if you trade your own account in the U.S. stock indices. If the market price of the Dow30 is making a new high or new low for the day during this 90 minute period, when it’s over if you have a position, you liquidate because the market will not go to a new high or a new low in the last 2 hours of trading. In other words, there isn’t enough power to propel prices higher or lower if the high or low is established during this 90 minutes; the market has basically blown whatever firepower it had [any and all stops or trapping longs/shorts into the close] during the Noon hour and there isn’t anything left for the rest of the day. Over the course of my trading career, I’d say this is true about 90% of the time; the other 10% just keep on going.

I’ll be here tomorrow in case anything happens [you never know], but I’m expecting tomorrow to be worse than today. Not anything serious on the economic calendar, with only inflation numbers Thursday & Friday, and consumer sentiment on Thursday; unless they are really off the wall with consensus misses, I can’t anybody caring what they are.

Action today totally meaningless, with small spikes all over the place leading nowhere; there’s a slight negative price bias lower today, but that doesn’t help you much if you sell it wrong and get stopped out on the spike up. And if you think this is bad, wait ‘till you see tomorrow [probably].

Half hour from the close and I’m outta here … PAMM spreadsheet directly below … beach is calling my name … until tomorrow mi amigos!
 




Have a great day everybody!

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OUR ‘TURNKEY FOREX’  PAMM/MAM  IS NOW OPEN AND OPERATIONAL; SEE “PAMM/MAM MANAGED MONEY PROGRAM” IN “DOWNLOAD LINKS” SECTION IN RIGHT HAND COLUMN FOR DETAILS [VIEW ONLINE AND/OR DOWNLOAD] AND START YOUR JOURNEY FROM WHERE YOU ARE AT TO “ESCAPE TO SUCCESS”!
  



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