Hope you are all well. As always lets check last weeks blog to the reality of what happened ... ok last week i mentioned the following:
So this week i have levels at 3019 / 3036/ 44 /50/75 on the upside weekly pivot is 2998
if we break that we have a series of supports at 93/88/82/75/62/56 and gaps to fill. Dow resistance 27530/27699 support 27110 WP /27k/26950/26875 NDX 8050/35/8000- 7875WP /7812 if we break weekly pivots and they convert to resistance then we could see a nice sell off. RTY am looking for resistance at 1594 /1600 support 1568/58/46."
Well it was a tough week to trade but the levels were pretty much correct particularly SPX, NQ and RUT and of course when we broke weekly pivot and converted 97 on the ES literally in the last 2 hours of trading we saw a sell off ... Always a nice helpful event before the close at the end of week! I had a few issues with my execution this week, which happens now and again, sadly i am mostly human and some days it just doesn't happen ! Tuesday and Friday were rough days where i could have nailed it but didn't and just managed to limp home. No point dwelling on this sometimes you can hit a home run every day and others for whatever reason you strike thin air.
I never like trading at ATH which has been the ways the last few years i much prefer trading overall ranges either up or down. As i have stated the market is somewhat of a flux at the moment, constant news events (china and so on) the FED will she won't she cut rates and by how much. It certainly feels markets are just waiting for the next fix and to hell with the data. Then suddenly on Friday we saw the news event re Iran taking a British ship and the catalyst begins.
I am always amazed at how a catalyst can and does happen at major levels in Indices and then suddenly the narrative changes immediately say from uber bullish we are going to 3100 to suddenly 5 days later no maybe that 3023 is the high and we walk down to 2700.
Of course Twitter can only exaggerate this with it's constant FinTwitters proclaiming to be correct every day on every trade. I have had an interesting week this week with twitter from people telling me i am a genius to other saying my tweets are not useful. I am beginning to get bored of twitter there seems to be sane people on it but others who really don't understand the dynamics of trading or how it works. Like any social technology Twitter caters to the masses and we all know deep inside most of the masses are idiots.
If you are following me and think that i will win every trade then you are an idiot and please unfollow me. If you understand that trading is to make consistent winners over losing trades over a set period usually a month or a quarter then you will be at least thinking correctly on how one should approach trading.
I guess i have to understand who my market is - Are my followers sane people and want to learn and progress or do they just want analysis that makes me correct every day. For example if i tell you every day: buy above X sell below Y else chop chop range day i will be right and then i can tell you how good i am and you can call me a genius each day. I can tell you it's in RT which clearly to any sane person it is not, i then can tell you i gave you a 30 point tick orgasm... if one of the levels breaks. Now if you are a breakout trader this is helpful but 1. It's not trading its just analysis and 2. It's not real time. To be trader you have to make decisions at the stated levels and know if its a trend day or range day and so on. It appears to me a lot of people want this rather than RT trades that i take. I am seriously thinking of going this way, why ? Well 1. It's very easy, i can tweet my levels at 2.30 uk time comeback at 9pm and call myself a genius and people will follow me in droves. 2. I don't have to tweet any of my trades thus it makes my life a whole lot easier. Analysis is easy there is no risk and the wisdom of the crowds ... on twitter seem to think this is impressive!
Look guys if this is what you want then tell me, i really don't mind as i said it will make my life measurable easier and i don't have to deal with people complaining they took 2 of my losing trades but not 12 of my winning trades, may be you want me to do both? Then of course i will get 10k followers by just stating some analysis that should be obvious to anyone. And of course failing that i can just tweet 50 times and retweet the correct one. Any way enough of this as i am clearly not going to educate 1000's of people on Twitter!
Understand you will make losing trades and lots of them, take Jesse Livermore purported to be one of the best traders of all time - he ended up penniless and shot himself, George Soros everyone remembers he broke the Bank of England and made a Billion $ & the Bank of Thailand for another Billion. Seemingly people forget he lost over $ 2 Billion in Russia Bonds in 1998 when Russia defaulted...
I had some good news from one of my followers this week, I spent 3 hours on a sunday with him going through how i trade and he came back to me this week saying that he is consistently doing very well and now wants to prop trade, he asked for funding ;-) I politely declined but it was good to see his progress!
I am putting a pack together to show you how i trade and will present it the 1st weekend of August and will invite those people who have wished to participate.
I think it's important for people to learn how to trade themselves and not be reliant on anyone; that's when you can truly practice the art of trading and until then you are just a fool, lucky fool may be but luck will always run out eventually.
ok the week ahead .... It's still another week to FED
Typically the week before FED we see a drop then a slow rise Monday Tuesday IE next week into it, so Thursday, Friday of this week we may be seeing some signs of bottoming out and may be even into Monday am. So barring any news events i think we are seeing the start of a mean reversion down to 2912 on ES. That will catch out all the suckers who will be still waiting for 3100. The WP on ES this week is 2987. Levels below 62/56/50/42/27/12/ above 94/98/3000/04/14/23/333/43. I will look into DOW, NQ and RUT later today and let you know tomorrow. In the midst of all this drama we are in a summer tape which means low volume and shitty chop chop days this is another pain in the ass to navigate so please be aware. Anyhow that's it for now will give more updates as we go along. Take care TI.