Dow Futures: What Can I Say...

22 мар. 2020 г.

Boy, what a way to start a new decade! I figured I'd try to bring some reality and reason back into the picture. I'm mainly a crypto trader but have an affinity for the index futures. I posted back in February my sentiment on the Dow, take a peek at my previous chart below. If you're not one of the sheep, then this is nothing but pure profit for you right now. I'd like bring a smidgen of my insight, as Obama would say, from the little crypto markets up to the "Big Show." Let's be clear, Obama owns this as much as, if not more than, Trump. But let's not get too political and focus on making money.

Yes, you should have been out back at the beginning of February as the Dow rolled over from 29k. Whether you went short or poorman's short, doesn't matter, you needed to be out. If you didn't, I'm sure there's a ton of you that got liquidated on margin. Not to condemn, just fact. If you got liquidated, there's a reason. You don't have enough knowledge about trading. That's why I'm posting this. To help add one more round in your arsenal and to get you to see the market in the correct light.

I don't trade off TA, Technical Analysis. I trade off of the other TA. Trend Analysis. As I've stated before, Technical Analysis is predictive. Trend Analysis is reactive, as you will see. From here on, reference to TA is to Trend, not Tech. I believe with this trading style you can hold your own in any market. Where's all the fancy technical indicators? I call them crutches. Candlesticks and the ability to draw a straight line is about it! I believe the more knowledge the better. So yes, you should learn technical analysis as much as you can so you know what the heard is thinking.

But...

-- CANDLESTICKS DON'T LIE!

My chart and explanation in this post is not complete nor is it expansive. I'm presenting a brief and basic synopsis to get you to envision your trading style in an alternative way, outside of the mainstream way of getting wreckt. You can use TA in many different ways. It all works pretty much the same, but, as you reduce the timeline, the demand to be reactive increases exponentially. E.i.; weekly to daily to minute, etc. If you study the Dow, it actually trades pretty well off the 1m because of the compressed time-frame. BTC or XRP I like 15m because it is so much more volatile. Always reference against the 1hr and 1D.

So, looking at the chart, I use what I call TLC with an F. Trends, Levels, Ceilings and Floors. In this chart I've only drawn in Levels and Floors for simplicity. Basically, I use gold lines for the floors and ceilings with a heavier line weight. Trend and level lines I use red and green. The horizontal level lines are used as your pivot points, your profit ratchet if you will. Notice you will never hit the top and bottom, but you will always place highly potentially profitable trades with lower risk. When people say trade without emotion, this is what it looks like.

The more you work with this technique, I can tell you that you can identify tops and bottoms pretty regular and trade those with nice tight stops.

Right now your reversal point is at the 21k mark. You're drop-dead floor is at 15k. Look for good long entry points at a double-tap off either of the gold floor lines. That's where the 1m candles can help to identify an entry point. If it pushes below 15k? Just keep drawing those trend lines.

One more thing; don't be afraid to let the market move in its range...

-- Get ome!

NOTE: Notice the extreme RSI fade compared to the new all-time high.

Usually I like to give a little Saturday night inspiration. But things are a little deep right now.

Here's a couple to reflect to. Classic, prophetic...

youtu.be/2ObjtVdsV3I?list=OLAK5uy_lLqrDSsxVNgt7dqhjvnHtKh0PAHIDw5Lw

Make sure you listen to this one to the end...

youtu.be/SOgVoxqKU7U?list=OLAK5uy_lLqrDSsxVNgt7dqhjvnHtKh0PAHIDw5Lw

Yin-Yang: Everything cycles...