If I told you this was easy I would be lying. The markets sell off, and everyone thinks the world is coming to an end and that a major correction is under way, and then the next thing you know the S&P futures are ripping higher. Like it or not zero borrowing cost continues to trump all…
Yesterday the PitBull stopped by. This time his Comcast was down and he was a restless bull. I think good traders like the Bull have to move around. It helps break up the long ups and downs of the day. Many years ago I taught him that trading into 11:00 CT (12:00 ET NY Lunch time) was too tricky and he should get away from the desk and go kill an hour or two. Now he does that everyday.
We also talked about how the game has changed, and we spoke about the summer trade being in full gear (VIX . While I learned a lot on the trading floor, the off floor learning curve was not easy. In the beginning I had Ninja charts and really could not read them that well. I know the Bull says to start drawing lines, but I am not sure I will ever be able to do that. But I stayed at it. My brother Bill-Bill reminded me that years ago, when I wanted out of the business, he offered me a salary, and I was quick to say, “Bill, I make five times that.”
And he was quick to say that he had been in the printing business for almost 35 years, and I would never make as much money starting out in printing as I did at the MERC. I knew I wouldn’t be able to make the money I did, but he went on to say, “Look, this is what you have been doing since you were a kid. It’s all you know, stay with it.”
Well, I did, and it wasn’t always easy. Sometimes I got depressed, especially when I was not reading well. I wanted to prove myself, and sometimes, no matter how hard I tried I just could not connect the dots. But like my brother Bill-Bill and the PitBull taught me, you can do it if you stick with it. During yesterday’s trade. I stuck with it.
I don’t pretend to win on every trade. Sometimes I get in too early and have to get out, and the futures end up going my favored way. And other times when I see the volume piling up at the highs or lows of the day, I just get right back in. That’s what I did yesterday. My gut told me I was right so I gave it a second try. Below is the exact time and sequence of the trade I made.
IMPRO : Dboy1 ( 11:03:13 AM ): sold 2118.75s
IMPRO : Dboy1 ( 11:07:52 AM ): out, 2120.75
Boys in the room giving me a hard time…
IMPRO : Dboy1 ( 11:32:52 AM ): sold 2120.50s
IMPRO : Dboy1 ( 12:02:18 PM ): paid 2117.50 on half
IMPRO : Dboy1 ( 12:30:00 PM ): paid 13.30 on the bal. stop is out
In the end, learning how to read the volume charts has enhanced my ability to read the overall “price action” of the S&P. Like I said, I do not win everyday but I try and limit my losses, and then start over anew. I also have the MrTopStep “collective” backing me up and that is something you can’t find anyplace else.
In Asia 8 out of 10 markets closed higher, and in Europe 10 out of 12 markets are trading higher this morning. Today’s eco calendar starts out the week with Durable Goods, Redbook, FHFA House Price Index, PMI Manufacturing Index FLASH, New Home Sales, Richmond Fed Manufacturing Index and a 2-Yr Note Auction.
11th Hour
Our View: They “jammed” a lot of buy stops yesterday but not all of them. The big question is, will the central banks and other creditors go for the deal? Right down to the 11th hour, the Greeks are still playing with the possibility of a default. Will they? Probably not, but the reality of all this is that, it’s better to clean this up now, than to kick the problem down the road again. As we all know hope is not a good strategy for trading the markets. That said, I think the S&P goes higher. There are a lot more buy stops to run, and it’s my guess, after some type of pullback, the ESU15 does what it does best: run the buy stops. Our view is to sell the early rally and buy weakness, or just wait for the ESU15 to sell off a bit and find a good spot to buy it.
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- In Asia 8 of 10 markets closed higher : Shanghai Comp. 2.19%, Hang Seng +0.93%, Nikkei +1.87%
- In Europe 10 out of 12 markets are trading higher : DAX +1.28%, FTSE +0.35%, MICEX -0.62% , GD.AT +4.33% at 7:00 am CT
- Fair Value: S&P-8.13, Dow -8.31 , Nasdaq -87.75
- Total Volume: 1.1 mil ESU and 2k SPU traded
- Economic calendar:Durable Goods, Redbook, FHFA House Price Index, PMI Manufacturing Index FLASH, New Home Sales, Richmond Fed Manufacturing Index, 2-Yr Note Auction.
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