Well what a week!. Let's take a quick look at last weeks blog and review it...
"I would like to see 2918 and then a bounce, look for some positive divergence set up (Daily RSI 30), the key will be then will we continue down post the bounce (maybe back to WP) or do we find support and another new high to 3050 area?
Well kinda of right that in we definitely went to 2918 and then some... and we definitely bounced and then some .... what an insane week! A 5% move down which virtually ended flat on the week. All this shows extreme volatility and a fragile market environment. Unbelievably we had bad ISM data and the market went down ! Yes bad data and it was bad for the market! Then we had bad non farm payrolls and the market decides this is good as more rate cuts. Get it? It's laughable but this is the market, I have been saying for ages the underlying picture of the fundamentals across the world are very poor and it is only a matter of time before this buy the bad data narrative ends. It clearly hasn't yet but when the US has FED rates of zero what then? If you want to see what happens look at the Nikkei or the DAX when all the central bakers runout of ammunition.
Now talk of insanity let's look at the week ahead - yay its the US China deal meeting 10/11th October conclusion, non conclusion, fudge, sideshow, shitshow whatever you want to call it.
So last week was clearly a shake out - Where next... Guys well if you want me to sit on the fence 3100,3050 or 2850,2750,2650 who the hell knows, it appears market wants to ramp into it as always on these type of events. Is there going to be a deal? No idea, my gut tells me there wont be a deal just more fudge. China will play the waiting game especially with this impeachment debacle. China has a lot to lose and gain from a deal mostly through opening the markets up to US companies and dealing with corporate governance and the like, this though is the antithesis of what a Communist regime want... Look let's be honest here the Dow and S&P are pretty much at ATH's and all you need to do for a ramp is mention the word "China" - so they can string along the markets for some time yet especially if the Chinese believe the nearer Trump gets to election the weaker he will be.
Much like the market forces the FED into action I think it will be the same for the China deal. So this week trading wise will be about positioning yourself for the main event. Firstly if there is no conclusion or indeed a conclusion, do not have a position next weekend! Could prove fatal. Whatever happens at the end of the week or indeed early next the move could be brutal either to upside or the downside so i would probably try and play some options or have resting orders above 3025 or say 50 points below the price on Friday to capture any potential violent move.
Ok next week...
ES WP 2933 levels above 2956,62,79,95,3000,16,25,33,50,92,100,150 below 2927,09,00,875,854,816,800,775,as always WP will be key as an early indicator
DOW Cash WP 26,454 above 27,031 27,165, 360 below 26k 25,850,500,400,280 24,600
NDX 7679. above 7700,27,750,800,900,950 below ,638,600,557,537,500,460,321
RUT WP 1500,36,50,78,94,600/615 below 494,462 450,38,23,400
I also mentioned after my first month of mentoring i would give an update. After the first month I now have 6 mentess and 1 guy who uses the discord channel. Only 2 of my traders have been active for the whole month (as others are either paper trading or setting up account and will now start active trading this week)
I can say it has been exhausting but extremely rewarding as you can see by the table below. The below table shows number of points gained per instrument week by week and as you can see they have shown progression and consistency and this week they absolutely smashed it ! I am very proud of these guys and their effort particularly around risk management / stops etc as they are now consistently get stopped at only 4 handles and as below shows letting their winning trades do the work. They made their month last week!
My discord channel guy has made a 12% return on his capital in the first 2 weeks so am sure he is happy too!
I think I will max out on mentess around 10 to 12 as i simply don't have the time for it as the 121's and talking / mentoring is very time consuming although as i say it's the best bit for me.
A couple of other things I put a cheat sheet about set ups on my website under the education section, let me know if you want me to cover anymore information. Lastly I have added automated alerts on twitter and my discord channel for upcoming figures such as initial jobless claims, non farm, pmi's etc as i thought that we be helpful, I will continue to add over the coming weeks.
Thanks and be careful this week. Cheers TI