Stock, Option and Futures Trading
July 24, 2011
From our last post on Friday we noted the ES was at 78% time resistance. Right now (Sunday night) the ES is down 12 points and the NQ is down 23 points. This does not mean we will open down and even though we are saying it is resistance that does not mean we go down either.
There will always be resistance in waves that are bullish and there will always be support in waves that are bearish (unless we are at a all time high or low).
It is the resistance being broken in uptrend that start the new leg up in the trend direction.
In time and price zones the bars become emotional and that is shown by the big movement right now before the market is even open. This is why it is important to understand the condition of the market before the market is even open. Knowing the condition can then give you the proper mindset to trade with the condition that is “in play”.
Traders often wonder why systems or methods work sometimes and fail other times. The answer to this is because the condition of the market changes from contraction to expansion over and over again and most systems are designed for only one condition.
We have our Kill Zone designed for the bigger waves and then our Turbo Scalper designed for scalping. Taking it a step further we also do a nightly video each night for our members to tell them which condition is “in play”. Tomorrow we will be scalping.
PS. Tomorrow will be a test for most traders to see if 1) their system can hold up to the emotion 2) if they can follow the rules of their system. Just because the range of the market gets bigger does not mean that most traders will make more. In reality it is just the opposite and most traders will lose more because of lack of rules and discipline to follow them. Do not be that trader tomorrow.