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ES NQ Futures Trading
- Thread starter Jahajee
- Start date
Human Indicators (compared to Technical ones)
Believe it or not, there is no âtheyâ who âmanipulateâ the market. But that is what many people choose to believe, particularly when they have lost money in a trade. Itâs always âthem.â But that is a bit convenient, donât you think? Almost as convenient as looking out the back window and seeing the patterns of the road behind? The truth is, there is no âthey.â Itâs all âus.â The market is made up nothing more than people like us. True, some of them have larger accounts than the average day trader, but still the âlarge accountsâ are swimming in the same ocean and are still trading âagainstâ each other just as much as they are âwithâ each other.
To illustrate, you need look no further than some of the leading market indices such as the S&P, Dow, or Nasdaq. Instruments based on these indices are some of the safest to trade because they are made up of a large âbasketâ of underlying stocks. They also tend to be more liquid. Futures and their âminiâ equivalent â the eminiâs â are the most highly leveraged, but you can also trade their ETF versions â individual tracking stocks that are pegged to their âparentâ indexes.
In theory, it should be possible for âthemâ to manipulate a particular stock just by placing a sudden sell order at volume, to force the price downâ¦then judiciously buying back at the lower price. That is what many traders call a âbreak-out fake-outâ â the market drops, then suddenly it lurches in the opposite direction, befuddling all the technical analysts who were following their indicators and channels and support pivots. âEverything was lined up, then âtheyâ came in and started playing games. I hate it when that happens!â
As a parent, manager and sometimes coach, I always suggest that people look at themselves before they start blaming others. Ever notice how itâs always âthat bad teacher?â Ever notice how the referee makes calls that favor the other team? Ever notice how the teacher is only bad when you got a bad grade, or the ref was bad only when you lost the game? Are we starting to see a pattern yet?
To manipulate the S&P 500, one would have to literally manipulate all 500 of its underlying stocks - or, at least, the ones with the highest weighting. Is that possible? Sure. But not likely. Rather than complain about "them" moving the markets against us, it is far more profitable to take a look at what "we" do as traders - what signatures do we have? What breadcrumbs do we drop behind us as we trade, that could lead us back to profitable turning points?
Next: more on human indicators
http://blog.traderslibrary.com/mich...an-indicators-compared-to-technical-ones.html
Believe it or not, there is no âtheyâ who âmanipulateâ the market. But that is what many people choose to believe, particularly when they have lost money in a trade. Itâs always âthem.â But that is a bit convenient, donât you think? Almost as convenient as looking out the back window and seeing the patterns of the road behind? The truth is, there is no âthey.â Itâs all âus.â The market is made up nothing more than people like us. True, some of them have larger accounts than the average day trader, but still the âlarge accountsâ are swimming in the same ocean and are still trading âagainstâ each other just as much as they are âwithâ each other.
To illustrate, you need look no further than some of the leading market indices such as the S&P, Dow, or Nasdaq. Instruments based on these indices are some of the safest to trade because they are made up of a large âbasketâ of underlying stocks. They also tend to be more liquid. Futures and their âminiâ equivalent â the eminiâs â are the most highly leveraged, but you can also trade their ETF versions â individual tracking stocks that are pegged to their âparentâ indexes.
In theory, it should be possible for âthemâ to manipulate a particular stock just by placing a sudden sell order at volume, to force the price downâ¦then judiciously buying back at the lower price. That is what many traders call a âbreak-out fake-outâ â the market drops, then suddenly it lurches in the opposite direction, befuddling all the technical analysts who were following their indicators and channels and support pivots. âEverything was lined up, then âtheyâ came in and started playing games. I hate it when that happens!â
As a parent, manager and sometimes coach, I always suggest that people look at themselves before they start blaming others. Ever notice how itâs always âthat bad teacher?â Ever notice how the referee makes calls that favor the other team? Ever notice how the teacher is only bad when you got a bad grade, or the ref was bad only when you lost the game? Are we starting to see a pattern yet?
To manipulate the S&P 500, one would have to literally manipulate all 500 of its underlying stocks - or, at least, the ones with the highest weighting. Is that possible? Sure. But not likely. Rather than complain about "them" moving the markets against us, it is far more profitable to take a look at what "we" do as traders - what signatures do we have? What breadcrumbs do we drop behind us as we trade, that could lead us back to profitable turning points?
Next: more on human indicators
http://blog.traderslibrary.com/mich...an-indicators-compared-to-technical-ones.html
This is an unusually long run/win streak for the market which has led to an extended technical posture. However, we have not seen any short term signs of topping action yet as the S&P again climbed back after modest intraday pressure to close just under the high after the early test of the June high. The pre-market bias is weaker and will be watching the short term supports 949/948 and 944/943 for an early read on the strength of anticipated early downticks. The next level of interest above the June/July highs at 956 is at 962/963 (38% of May 2008-March 2009 decline, congestion, 50 week ema).
Tuesday Summary: The stock market opened on a firmer note in the wake of the recent win streak with this upside momentum boosted by solid earnings (CAT) and some overseas strength. The advance for most of the market quickly stalled out with the early S&P push stalling right at its June peak at 956.23 (session high 956.53). The combination of technicals (extended market at resistance of note) and news/fundamentals (disappointing outlook from CAT's conference call, poor earnings in Finance -RF- and the Fed Chair's outlook for a slow recovery) led to a steady but only modest slide into early afternoon trade. No follow through developed with the S&P stabilizing near congestion in the 944/943 area noted here with the bounce into the close allowing for the indices to extend winning streaks (Nasdaq up 10 in a row, Dow 7 in a row, S&P 6 out of last 7; all set new multi-month close highs). Sectors helping lead the way higher were Paper +5.5%, Solar TAN +4.9%, Disk Drive +3.1%, Biotech +2.7%, Chemical +2.1%, Auto Parts +2%, Pharma PPH +1.8%, Health XLV +1.5%, Materials XLB +1.3%, Education, Machinery. Groups in the red included: Coal -3.6%, Airline -35, Finance (KBE -3%, RKH -1.1%, XLF -0.9%), Casino -1.6%, Computer-Hardware -1.6%, Trucking -1.5%, Steel -1%.
Tuesday Summary: The stock market opened on a firmer note in the wake of the recent win streak with this upside momentum boosted by solid earnings (CAT) and some overseas strength. The advance for most of the market quickly stalled out with the early S&P push stalling right at its June peak at 956.23 (session high 956.53). The combination of technicals (extended market at resistance of note) and news/fundamentals (disappointing outlook from CAT's conference call, poor earnings in Finance -RF- and the Fed Chair's outlook for a slow recovery) led to a steady but only modest slide into early afternoon trade. No follow through developed with the S&P stabilizing near congestion in the 944/943 area noted here with the bounce into the close allowing for the indices to extend winning streaks (Nasdaq up 10 in a row, Dow 7 in a row, S&P 6 out of last 7; all set new multi-month close highs). Sectors helping lead the way higher were Paper +5.5%, Solar TAN +4.9%, Disk Drive +3.1%, Biotech +2.7%, Chemical +2.1%, Auto Parts +2%, Pharma PPH +1.8%, Health XLV +1.5%, Materials XLB +1.3%, Education, Machinery. Groups in the red included: Coal -3.6%, Airline -35, Finance (KBE -3%, RKH -1.1%, XLF -0.9%), Casino -1.6%, Computer-Hardware -1.6%, Trucking -1.5%, Steel -1%.