
Simple Strategies for Short Funded Traders
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Traders Helping Traders E-zine for the week 10-15-2006 - Test Drive Edition |
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Part One - Erich's Trades |
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Lesson du Jour
Question:
It is IMPORTANT TO NOTE that these tools only help me narrow
my search for important support and resistance levels. I do not trade the
numbers these tools offer up blindly, but they are helpful for narrowing
your focus. Got a question that
needs answering like an itch you can't scratch? Send it along to me at
Erich@tradershelpingtraders.net
and I'll be happy to try and clear things up for
you. |
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A Sampling of the Markets we're covering this week... |
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The charts in this publication are all made using Gecko's Track 'n Trade charting software. You can get a demo for free here. Energies Market OverviewThe Energy complex has remained rather passive the last week or so. After a big decline a few weeks earlier it seems that the market has put on the brakes as it decides what to do next. I thought that we'd see a bigger pullback, but it hasn't materialized – yet. I also thought that last week's run lower Wednesday might be the resumption of the downtrend, so we sold it, but it quickly died off and now we're back above support. The downtrend is still in good shape and will probably continue for the longer term. RSI is fairly neutral, which is also a good sign for the current trend. In spite of these conditions however, prices continue to honour the support at/near the low. I thought about shorting the market(s) on Monday, as that is usually a good opportunity to get into the big ranging markets; however until we see something trade closer to the proven support level I'm going to stay cautious. Mini – Natural Gas A good start to our first mini-Natural Gas trade last week as we sold the market after it showed us resistance at 8.21. How did I know the market showed me resistance? Because it traded lower the next day, that's how. When you're trading a mini contract it is important to take your cues from the larger contract. Looking at the mini-NG you'd never really get a feel for what is happening in the market; however when you look at the full sized contract you can easily see that the market is in a rather large, long term decline. This is not (or was not) as easy to see on the mini contract chart. Now that the market is underway, we might be in for a bit of a run as DMI continues to look strong and might even be picking up steam. If you tightened your stops above the intraday resistance at 7.50 for Friday, then you're already flat; however if you're still in the trade you might consider bringing stops in above Friday's high for Monday. The "ideal" stop is still above Thursday's high, but with over $1000 in profit as of the close, that might be a touch too much risk to hold. CONTINUATION of Short December mini-Natural Gas from 7.79 Exit Order: 7.55 Approximate Risk Exposure: $0 per contract Profit Target: 7.03 Approximate Potential Profit: $1900 per contract RRR: n/a Degree of Risk: Moderate
The charts in this publication are all made using Gecko's Track 'n Trade charting software. You can get a demo for free here. The rest of the Markets in all sectors are covered in the Subscriber Edition. This is only a small sample of the markets we cover! For a detailed analysis of ALL of the markets, with explicit charts, entries, exits, stops, risk/reward ratio, potential profit, (and much more) please join us at http://www.supportandresistance.com/subscribe.html If you have any questions at all about any of these chart lessons, please feel free to ask at the futures trading forum or click here to email us. You can also chat with Erich and Tom live every Wednesday evening at 9:30pm eastern in the HotComm webinar room. Click the link for details about the Support and Resistance Trading Webinars.
Erich's Updates for Tuesday - watch the blog:
Tom's Updates for Tuesday
- watch the blog:
Erich's Updates for Wednesday -
watch the blog:
Tom's Updates for Wednesday - watch the blog:
Erich's Updates for Thursday -
watch the blog: Tom's Update for Thursday - watch
the blog:
Erich's Update for Friday -
watch the blog:
Tom's Update for Friday -
watch the blog: For a detailed analysis of ALL of the markets, with explicit charts, entries, exits, stops, risk/reward ratio, potential profit, (and much more) please join us at http://www.supportandresistance.com/subscribe.html Take care, and good trades to you for the coming week!
The charts in this
publication are all made using Gecko's Track 'n Trade charting software. You
can get a demo for free
here. |
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The Scorecard |
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The purpose of this section is to give you a feel for which markets might be worth trading and which you might pass on given your own set of circumstances. The figures quoted are based on the price levels outlined in the ezine, trading single contracts and do not accurately account for slippage, commissions or other trading related fees. The Score Card is updated monthly. Summary for the Month of September 2006
* NOTE!!! Trading commodities is RISKY!!!! These figures are estimates in the interests of tracking the trades. Erich may or may not have a real money position in any market covered at any given time. This Score Card does NOT apply to Tom's Trades. This is neither a solicitation to trade nor a recommendation of any strategy. Always consult your broker or advisor before attempting any trade. Commodity trading involves substantial risk of loss. See full disclaimers at the bottom of this email.
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Homework |
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None this week |
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Pick of the Letter |
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Futures Trading is Risky! Never trade with money you cannot afford to lose! |
THE DATA CONTAINED HERE IN ARE BELIEVED TO BE RELIABLE BUT CANNOT BE GUARANTEED AS TO RELIABILITY, ACCURACY OR COMPLETENESS; AND AS SUCH ARE SUBJECT TO CHANGE WITHOUT NOTICE. TRADERS HELPING TRADERS AND IT'S ASSOCIATES WILL NOT BE RESPONSIBLE FOR ANYTHING WHICH MAY RESULT FROM RELIANCE ON THIS DATA OR THE OPINIONS EXPRESSED HEREIN. DISCLOSURE OF RISK: THE RISK OF LOSS IN TRADING FUTURES AND OPTIONS CAN BE SUBSTANTIAL; THEREFORE, ONLY GENUINE RISK FUNDS SHOULD BE USED. FUTURES AND OPTIONS MAY NOT BE SUITABLE INVESTMENTS FOR ALL INDIVIDUALS, AND INDIVIDUALS SHOULD CAREFULLY CONSIDER THEIR FINANCIAL CONDITION IN DECIDING WHETHER TO TRADE. OPTION TRADERS SHOULD BE AWARE THAT THE EXERCISE OF A LONG OPTION WOULD RESULT IN A FUTURES POSITION. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL, OR IS LIKELY TO, ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM. HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. ONE OF THE LIMITATIONS OF HYPOTHETICAL
PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF
HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL
RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE
IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO
WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM, IN SPITE OF
TRADING LOSSES, ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL
TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS,
IN GENERAL, OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH
CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL
PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING
RESULTS. Traders Helping Traders Publications, including this one, are all copyright Traders Helping Traders, all rights reserved. -
www.supportandresistance.com
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