2.0. Learning to Profit from Futures Trading with an Unfair Advantage! Income Generating Strategies Starting the Trading Day

Transcription

1 2.0 Learning to Profit from Futures Trading with an Unfair Advantage! Income Generating Strategies Starting the Trading Day

2 Income Generating Strategies Starting the Trading Day Pre-Market Analysis Before the market opens every day, I suggest going through certain steps for analyzing the markets to help give you the bigger picture of what s going on in the market and to prepare yourself for the day s trading activity. Just because you decide to day trade does not mean that you only look at smaller time frame charts (i.e. 3 minute chart). You must remember to take the blinders off and to look at the bigger picture. This will help you to determine when and where the bigger moves should occur in the market. It is a very simplistic process that will help keep you organized and that takes no more than ten minutes. What, if any, Economic News Announcements are coming out Today? Briefing.com FOREX Factory Bloomberg Be aware of the Times of Day of any Economic News Events and/or Announcements. If you miss an important News Event, there may be consequences! 2

3 Pre-Market Checklist 1) You should be able to see the entire Prior Day (09:30am to 4:15pm ET) on your 3 Minute Chart and the last hour or two of the day prior to the Prior Day. You also will want to review the Overnight Session. 2) Is the Continuous Market Flow UP or DOWN (Based on the 2 of 3 Criteria for determining Trend)? 3) Draw necessary Fibonacci Retracements according to Continuous MFAM Trend (if applicable). Take note of where the Fibonacci Retracements and the Key Moving Averages are positioned. 4) Take note of Prior Day HIGH, LOW, MRAH, and MRAL. Also, take note of where the Floor Trader Pivots are (is there confluence with a Daily Pivot and Weekly/Monthly Pivot). 5) Look at the 30 Minute, 60 Minute, and DAILY Chart to see if there s any significant Trade Set-up based on these charts. Specifically, you are looking for the 3 Powerful Price Patterns in an established TREND (at a logical level of SUPPORT or RESISTANCE and/or testing a major HIGH or a major LOW). 6) Is the Prior Day extremely BULLISH or BEARISH? General Rule of Thumb: The market typically follows or is a CONTINUATION of the Prior Day s Price Acton for the First Hour; after the First Hour (10:30am ET), the market typically becomes/acts independent of the Prior Day. Trading Concepts, Inc. 3

4 Income Generating Strategies Starting the Trading Day 1) What is the Prior Day s Chart telling you? Review the Overnight Session The Overnight Session HIGH and LOW may act as SUPPORT and/or RESISTANCE if the market tests these price levels within the First Hour of trading. Identifying where the market is trading during the Overnight Session before Normal Trading Hours OPEN (09:30am ET) will give you a good sense of whether or not you can expect an OPENING GAP UP or DOWN or a neutral OPEN. Examine the entire Prior Day s (Trading Hours only 09:30am ET to 4:15pm ET) Price Action on the 3 Minute Chart This will provide you with a good sense of where the market is likely to go within the First Hour of trading on a neutral OPEN. General Rule of Thumb: The First Hour (9:30 to 10:30 ET) of trading typically follows or is a continuation of Prior Day MFAM. Generally speaking, after the First Hour (after 10:30am), the market becomes independent of the Prior Day s Price Action. Trading Concepts, Inc. 4

5 1) What is the Prior Day s Chart telling you? Review the GLOBEX Overnight Session and Examine the entire Prior Day s (Trading Hours only 09:30am ET to 4:15pm ET) Price Action on the 3 Minute Chart to identify where the Market is and where it is most likely to go. Before Market OPEN: 1. Review the GLOBEX Overnight Session and identify the HIGH and LOW of the Overnight Session. 2. You should be able to see the entire Prior Day (09:30am ET to 4:15pm ET) on your 3 Minute Chart and the last hour or two of the day before the Prior Day. 5

6 1) What is the Prior Day s Chart telling you? Review the GLOBEX Overnight Session and Examine the entire Prior Day s (Trading Hours only 09:30am ET to 4:15pm ET) Price Action on the 3 Minute Chart to identify where the Market is and where it is most likely to go. Before Market OPEN: 1. Review the GLOBEX Overnight Session and identify the HIGH and LOW of the Overnight Session. 2. You should be able to see the entire Prior Day (09:30am ET to 4:15pm ET) on your 3 Minute Chart and the last hour or two of the day before the Prior Day. 6

7 Income Generating Strategies Starting the Trading Day 2) Is the TREND (the continuous Market Flow) UP or DOWN? UPTREND (2 of 3 criteria MUST be met): UPSIDE penetration of the 62% Fibonacci Retracement of the entire Day s Trend. UPSIDE penetration of the Mid Keltner through Both MAs (79 SMA/89 EMA) or 3 consecutive Price Bars/Candlesticks trading completely above the Upper MA. UPSIDE penetration of the MRAH (Most Recent Active High). DOWNTREND (2 of 3 criteria MUST be met): DOWNSIDE penetration of the 62% Fibonacci Retracement of the entire Day s Trend. DOWNSIDE penetration of the Mid Keltner through Both MAs (79 SMA/89 EMA) or 3 consecutive Price Bars/Candlesticks trading completely below the Lower MA. DOWNSIDE penetration of the MRAL (Most Recent Active Low). General Rule of Thumb: The First Hour (9:30 to 10:30 ET) of trading typically follows or is a continuation of Prior Day MFAM. Generally speaking, after the First Hour (after 10:30am), the market becomes independent of the Prior Day s Price Action. Trading Concepts, Inc. 7

8 2) Is the TREND (the continuous Market Flow) UP or DOWN? Determine the TREND of the continuous MFAM. The First Hour (9:30 to 10:30 ET) of trading typically follows or is a continuation of Prior Day MFAM. Generally speaking, after the First Hour (after 10:30am), the market becomes independent of the Prior Day s Price Action. 8

9 2) Is the TREND (the continuous Market Flow) UP or DOWN? Determine the TREND of the continuous MFAM. The First Hour (9:30 to 10:30 ET) of trading typically follows or is a continuation of Prior Day MFAM. Generally speaking, after the First Hour (after 10:30am), the market becomes independent of the Prior Day s Price Action. 9

10 Income Generating Strategies Starting the Trading Day 3) Where are the Fibonacci Retracement Levels and the Key Moving Averages? Identify Fibonacci Retracement Levels of the Prior Day: Use the Fibonacci Retracements in conjunction with the continuous Market Flow (MFAM) Identify the Fibonacci Retracement Levels using Prior Day HIGH, LOW, or MRAL (UP Trend), or MRAH (DOWN Trend). Fibonacci Retracement Price Levels primarily are used for entering the Trend. Fibonacci Retracement Levels help determine potential strength/weakness in a Trend Minor Fibonacci Retracements (38% and 50%): If the market is likely to CONTINUE the TREND, pullbacks/retracements generally will hold at the 38% and 50% Fibonacci Retracement Levels. Major Fibonacci Retracement (62%): If the market is likely to REVERSE the TREND, pullbacks/retracements will penetrate the 62% Fibonacci Retracement Level. Identify the Location of the Key Moving Averages (79/89 MAs and the 50/200 MAs): These Moving Averages are visual confirmation of the Larger Fibonacci Retracement Levels. Trading Concepts, Inc. 10

11 3) Where are the Fibonacci Retracement Levels and the Key Moving Averages? Identify where the market is trading relative to the Fibonacci Retracements Levels of the Prior Day. Has the market penetrated through a Major Fibonacci Retracement Level? Identify where the market is trading relative to the Location of the Key Moving Averages. Is the market trading above or below the Moving Averages? 11

12 3) Where are the Fibonacci Retracement Levels and the Key Moving Averages? Identify where the market is trading relative to the Fibonacci Retracements Levels of the Prior Day. Has the market penetrated through a Major Fibonacci Retracement Level? Identify where the market is trading relative to the Location of the Key Moving Averages. Is the market trading above or below the Moving Averages? 12

13 Income Generating Strategies Starting the Trading Day 4) Take note of the Prior Day SIGNIFICANT Price Levels and Floor Trader Pivots IDENTIFY the Following: Prior Day HIGH and LOW. Prior Day MRAL (UP Trend). Prior Day MRAH (DOWN Trend). Floor Trader Pivots (Monthly, Weekly, and Current Day). Recommendation: Draw horizontal lines at these Price Levels for reference. Identifying these Price Levels will help to identify Support/Resistance for: Confirmation of the existing Trend. Potential Change in Trend (when Price Action penetrates above/below these Price Levels). Counter-Trend moves. Trading Concepts, Inc. 13

14 4) Take note of the Prior Day SIGNIFICANT Price Levels and Floor Trader Pivots. Identify where the market is trading relative to the Prior Day HIGH, LOW, MRAL (if MFAM UP), MRAH (if MFAM DOWN), and the Floor Trader Pivots (Monthly, Weekly, and Current Day). 14

15 4) Take note of the Prior Day SIGNIFICANT Price Levels and Floor Trader Pivots. Identify where the market is trading relative to the Prior Day HIGH, LOW, MRAL (if MFAM UP), MRAH (if MFAM DOWN), and the Floor Trader Pivots (Monthly, Weekly, and Current Day). 15

16 Income Generating Strategies Starting the Trading Day 5) Where are Bigger SUPPORT and RESISTANCE Levels? EXAMINE the 30 Minute, 60 Minute, and DAILY Charts for the Following: The Longer-Term TREND (30 Min, 60 Min, and Daily Chart). A significant Trade Set-up (examine these Time Frames as if they were a 3 Minute Chart). Anyone of the 3 BULLISH Powerful Price Patterns in an established UP TREND at a Logical Level of SUPPORT or testing a major LOW Anyone of the 3 BEARISH Powerful Price Patterns in an established DOWN TREND at a Logical Level of RESISTANCE or testing a major HIGH 16

17 5) Where are Bigger SUPPORT and RESISTANCE Levels? EXAMINE the 30 Minute, 60 Minute, and DAILY Charts for the Following: The Longer-Term TREND (30 Min, 60 Min, and Daily Chart). A significant Trade Set-up (examine these Time Frames as if they were a 3 Minute Chart). Anyone of the 3 Powerful Price Patterns trading at Logical Levels of SUPPORT/RESISTANCE. Longer-Term TREND is UP! Bearish Quasi Engulfing Pattern (BEOVB) MRAH Successive Trend Entries Bullish Quasi Engulfing Pattern (BUOVB) with Initial Trend Entry at a Logical Level of SUPPORT 17

18 5) Where are Bigger SUPPORT and RESISTANCE Levels? EXAMINE the 30 Minute, 60 Minute, and DAILY Charts for the Following: The Longer-Term TREND (30 Min, 60 Min, and Daily Chart). A significant Trade Set-up (examine these Time Frames as if they were a 3 Minute Chart). Anyone of the 3 Powerful Price Patterns trading at Logical Levels of SUPPORT/RESISTANCE. Longer-Term TREND is UP! MRAH Successive Trend Entries Successive Trend Entries Bullish Quasi Engulfing Pattern (BUOVB) at a lower Logical Level of SUPPORT (MAs) following a Successive Trend Entry Initial Trend Entry Neutral Harami (IVB) at a lower Logical Level of SUPPORT (MAs) following an Initial Trend Entry 18

19 5) Where are Bigger SUPPORT and RESISTANCE Levels? EXAMINE the 30 Minute, 60 Minute, and DAILY Charts for the Following: The Longer-Term TREND (30 Min, 60 Min, and Daily Chart). A significant Trade Set-up (examine these Time Frames as if they were a 3 Minute Chart). Anyone of the 3 Powerful Price Patterns trading at Logical Levels of SUPPORT/RESISTANCE. Longer-Term TREND is UP! Initial Trend Entries Successive Trend Entry MRAL Trend Officially DOWN! Successive Trend Entries with a Neutral Harami (IVB) at a Logical Level of SUPPORT Neutral Harami (IVB) at a higher Logical Level of RESISTANCE (MAs) following a Successive Trend Entry Initial Trend Entries Longer-Term TREND is DOWN! 19

20 5) Where are Bigger SUPPORT and RESISTANCE Levels? EXAMINE the 30 Minute, 60 Minute, and DAILY Charts for the Following: The Longer-Term TREND (30 Min, 60 Min, and Daily Chart). A significant Trade Set-up (examine these Time Frames as if they were a 3 Minute Chart). Anyone of the 3 Powerful Price Patterns trading at Logical Levels of SUPPORT/RESISTANCE. Initial Trend Entry with a Neutral Harami (IVB) Bearish Quasi Engulfing Pattern (BEOVB) at a higher Logical Level of RESISTANCE (near MAs) following an Initial Trend Entry Successive Trend Entry with a Neutral Harami (IVB) Successive Trend Entry Trend Officially DOWN! Longer-Term TREND is DOWN! 20

21 Income Generating Strategies Starting the Trading Day 6) Is the Prior Day an extremely BULLISH Vertical Bar/Candlestick? A potential LONG Trade may be setting up if the following criteria are met: 1. Prior Day BULLISH Vertical Bar or BULLISH Candlestick with the CLOSE in the TOP ¼ of the Price Bar/Candlestick s Range. 2. Today's OPEN is Lower and AT or ABOVE the Midrange (50% Fibs) of the Prior Day. 3. The market is trading AT or MOVES LOWER into SUPPORT (the 79/89 MAs and/or between the 38% and 62% Fibs of the Prior Day). PRIOR DAY CLOSE PRIOR DAY CLOSE MIDRANGE TODAY S OPEN BUY 89/79 MAs MIDRANGE TODAY S OPEN BUY 89/79 MAs 50% FIBS 50% FIBS Trading Concepts, Inc. 21

22 6) Is the Prior Day an extremely BULLISH Vertical Bar/Candlestick? A potential LONG Trade may be setting up if the following criteria are met: 1. Prior Day BULLISH Vertical Bar or BULLISH Candlestick with the CLOSE in the TOP ¼ of the Price Bar/Candlestick s Range. 2. Today's OPEN is Lower and AT or ABOVE the Midrange (50% Fibs) of the Prior Day. 3. The market is trading AT or MOVES LOWER into SUPPORT (the 79/89 MAs and/or between the 38% and 62% Fibs of the Prior Day). 22

23 Income Generating Strategies Starting the Trading Day 6) Is the Prior Day an extremely BEARISH Vertical Bar/Candlestick? A potential SHORT Trade may be setting up if the following criteria are met: 1. Prior Day BEARISH Vertical Bar or BEARISH Candlestick with the CLOSE in the BOTTOM ¼ of the Price Bar/Candlestick s Range. 2. Today's OPEN is Higher and AT or BELOW the Midrange (50% Fibs) of the Prior Day. 3. The market is trading AT or MOVES HIGHER into RESISTANCE (the 79/89 MAs and/or between the 38% and 62% Fibs of the Prior Day). MIDRANGE 89/79 MAs MIDRANGE 89/79 MAs 50% FIBS TODAY S OPEN SELL 50% FIBS TODAY S OPEN SELL PRIOR DAY CLOSE PRIOR DAY CLOSE Trading Concepts, Inc. 23

24 6) Is the Prior Day an extremely BEARISH Vertical Bar/Candlestick? A potential SHORT Trade may be setting up if the following criteria are met: 1. Prior Day BEARISH Vertical Bar or BEARISH Candlestick with the CLOSE in the BOTTOM ¼ of the Price Bar/Candlestick s Range. 2. Today's OPEN is Higher and AT or BELOW the Midrange (50% Fibs) of the Prior Day. 3. The market is trading AT or MOVES HIGHER into RESISTANCE (the 79/89 MAs and/or between the 38% and 62% Fibs of the Prior Day). 24

25 Income Generating Strategies Starting the Trading Day Opening Bell 09:30am ET - Market Open Based on your Pre-Market Analysis, you know and/or have determined 1. Overnight SUPPORT and RESISTANCE, where the market is trading, and where the market is likely to go within the First Hour of trading because you know the market typically follows or is a continuation of the Prior Day s Price Action for the First Hour and after the First Hour (10:30am ET) of the Current Trading Day, generally speaking, becomes independent of the Prior Day. 2. What the TREND is by identifying the continuous MFAM (based on using the criteria for a Trend Change). 3. Where the Major Fibonacci Retracement Levels and Key Moving Averages are. 4. Where the Prior Day SIGNIFICANT Price Levels (the HIGH, LOW, MRAL (in an UP Trend), MRAH (in a DOWN Trend), and the Floor Trader Pivots) are so as to confirm an existing Trend and/or a potential change in Trend). 5. Where the Bigger SUPPORT and RESISTANCE Levels are and if there are any Trade Set-ups or any one of the 3 Powerful Price Patterns occurring on the Longer-Term Time Frames (30 Minute, 60 Minute, or Daily Charts). 6. If there is a Trade Set-up based on the Prior Day s Price Pattern coming into a new trading day (an extremely Bullish Price Bar/Candlestick or an extremely Bearish Price Bar/Candlestick). Trading Concepts, Inc. 25

26 Income Generating Strategies Starting the Trading Day First 1/2 Hour (09:30am ET to 10:00am ET) What to Do? How to Think? Generally, SIT, WATCH, and WAIT for the First ½ Hour (90% of the Time) to unfold, unless something really extraordinary sets up, such as: 1. A Trade Set-up occurs on the 30 Minute, 60 Minute, or Daily Chart. An Initial Trend Entry, Successive Trend Entry, or any one of the 3 Powerful Price Patterns is found at Longer-Term SUPPORT or RESISTANCE occurring on any one of these Longer-Term Time Frame Charts. 2. Prior Day Price Pattern indicates a potential Trade Set-up coming into a new trading day. NOTE: An extremely Bullish or Bearish Vertical Bar / Candlestick occurring on the Prior Day. These would be MORE AGGRESSIVE Trading Strategies if they occur within the First 1/2 Hour. Trading Concepts, Inc. 26

27 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKOUT Strategy (BUY Entry) During the first 30 Minutes of trading, SIT, WATCH, and WAIT until the market moves and penetrates UP through the HIGH of the First ½ Hour. You will assume that a penetration UP through the HIGH of the First ½ Hour will be the beginning of an UPTREND and BUY the BREAKOUT. BREAKOUT BUY (LONG) Entry Once the HIGH of the First ½ Hour has been penetrated to the UPSIDE, you will look to BUY the market on a BREAKOUT one or two ticks (on.25 or.75) ABOVE the HIGH of the First ½ Hour. According to this Trading Strategy, you will be BUYING the market as it s moving higher without waiting for a retracement/pullback. Trading Concepts, Inc. 27

28 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKOUT Strategy (Trade Management) Initial Stop Loss (ISL) The Initial Stop Loss (ISL) needs to be placed slightly BELOW the LOW of the Price Bar/Candlestick that penetrated UP through the HIGH of the First ½ Hour or placed slightly BELOW the most recent Pivot Low (PL), whichever is LOWER. If any one of the 3 BULLISH Powerful Price Patterns develops while you are in a trade, IMMEDIATELY bring your STOP UP to slightly BELOW the LOW of the BULLISH Powerful Price Pattern. This remains true the whole time that you are in a trade. Trading Concepts, Inc. 28

29 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKOUT Strategy (Trade Management) Profit Objectives (POs) Three logical Profit Objectives whenever you are looking to BUY the market on a BREAKOUT above the HIGH of the First ½ Hour: Profit Objective #1 (P.O.#1) is 1.00 ES Point ABOVE where you bought LONG the market. Profit Objective #2 (P.O.#2) is slightly BELOW the 1.50 Fibonacci Extension of the Total Range (the HIGH minus the LOW) of the First ½ Hour. Profit Objective #3 (P.O. #3) is slightly BELOW the 2.00 Fibonacci Extension of the Total Range (the HIGH minus the LOW) of the First ½ Hour. Logical Trailing Stop (TS) Aggressive (Tighter TS): As each consecutive Price Bar/Candlestick makes a New High, continue to move a TRAILING STOP UP slightly BELOW the LOW of each consecutive Price Bar/Candlestick. Conservative (Wider TS): Continue to move a TRAILING STOP UP slightly BELOW the Lower Keltner Channel Band as the market moves higher in your favor. Trading Concepts, Inc. 29

30 First ½ Hour BREAKOUT (BUY Entry and Trade Management) BUY (Enter LONG) the market one or two ticks ABOVE the HIGH of the First TEN 3-Minute Price Bars/Candlesticks. Initial Stop Loss (ISL) needs to be placed BELOW the LOW of the Price Bar/Candlestick that penetrated UP through the HIGH of the First ½ Hour or placed BELOW the most recent Pivot Low (PL), whichever is LOWER. Profit Objectives (POs): P.O.#1 placed 1.00 ES Point ABOVE LONG Entry; P.O.#2 placed BELOW the 1.50 Fibonacci Extension of the Total Range of the First ½ Hour; P.O.#3 placed BELOW the 2.00 Fibonacci Extension of the Total Range of the First ½ Hour. 30

31 First ½ Hour BREAKOUT (BUY Entry and Trade Management) BUY (Enter LONG) the market one or two ticks ABOVE the HIGH of the First TEN 3-Minute Price Bars/Candlesticks. Initial Stop Loss (ISL) needs to be placed BELOW the LOW of the Price Bar/Candlestick that penetrated UP through the HIGH of the First ½ Hour or placed BELOW the most recent Pivot Low (PL), whichever is LOWER. Profit Objectives (POs): P.O.#1 placed 1.00 ES Point ABOVE LONG Entry; P.O.#2 placed BELOW the 1.50 Fibonacci Extension of the Total Range of the First ½ Hour; P.O.#3 placed BELOW the 2.00 Fibonacci Extension of the Total Range of the First ½ Hour. 31

32 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKDOWN Strategy (SELL Entry) During the first 30 Minutes of trading, SIT, WATCH, and WAIT until the market moves and penetrates DOWN through the LOW of the First ½ Hour. You will assume that a penetration DOWN through the LOW of the First ½ Hour will be the beginning of a DOWNTREND and SELL the BREAKDOWN. BREAKDOWN SELL (SHORT) Entry Once the LOW of the First ½ Hour has been penetrated to the DOWNSIDE, you will look to SELL the market on a BREAKDOWN one or two ticks (on.25 or.75) BELOW the LOW of the First ½ Hour. According to this Trading Strategy, you will be SELLING the market as it s moving lower without waiting for a retracement/pullback. Trading Concepts, Inc. 32

33 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKDOWN Strategy (Trade Management) Initial Stop Loss (ISL) The Initial Stop Loss (ISL) needs to be placed slightly ABOVE the HIGH of the Price Bar/Candlestick that penetrated DOWN through the LOW of the First ½ Hour or placed slightly ABOVE the most recent Pivot High (PH), whichever is HIGHER. If any one of the 3 BEARISH Powerful Price Patterns develops while you are in a trade, IMMEDIATELY bring your STOP DOWN to slightly ABOVE the HIGH of the BEARISH Powerful Price Pattern. This remains true the whole time that you are in a trade. Trading Concepts, Inc. 33

34 Income Generating Strategies Starting the Trading Day First ½ Hour BREAKDOWN Strategy (Trade Management) Profit Objectives (POs) Three logical Profit Objectives whenever you are looking to SELL the market on a BREAKDOWN below the LOW of the First ½ Hour: Profit Objective #1 (P.O.#1) is 1.00 ES Point BELOW where you sold SHORT the market. Profit Objective #2 (P.O.#2) is slightly ABOVE the 1.50 Fibonacci Extension of the Total Range (the HIGH minus the LOW) of the First ½ Hour. Profit Objective #3 (P.O. #3) is slightly ABOVE the 2.00 Fibonacci Extension of the Total Range (the HIGH minus the LOW) of the First ½ Hour. Logical Trailing Stop (TS) Aggressive (Tighter TS): As each consecutive Price Bar/Candlestick makes a New Low, continue to move a TRAILING STOP DOWN slightly ABOVE the HIGH of each consecutive Price Bar/Candlestick. Conservative (Wider TS): Continue to move a TRAILING STOP DOWN slightly ABOVE the Upper Keltner Channel Band as the market moves lower in your favor. Trading Concepts, Inc. 34

35 First ½ Hour BREAKDOWN Strategy (SELL Entry) SELL (Enter SHORT) the market one or two ticks BELOW the LOW of the First TEN 3-Minute Price Bars/Candlesticks. Initial Stop Loss (ISL) needs to be placed ABOVE the HIGH of the Price Bar/Candlestick that penetrated DOWN through the LOW of the First ½ Hour or placed ABOVE the most recent Pivot High (PH), whichever is HIGHER. Profit Objectives (POs): P.O.#1 placed 1.00 ES Point BELOW SHORT Entry; P.O.#2 placed ABOVE the 1.50 Fibonacci Extension of the Total Range of the First ½ Hour; P.O.#3 placed ABOVE the 2.00 Fibonacci Extension of the Total Range of the First ½ Hour. 35

36 First ½ Hour BREAKDOWN Strategy (SELL Entry) SELL (Enter SHORT) the market one or two ticks BELOW the LOW of the First TEN 3-Minute Price Bars/Candlesticks. Initial Stop Loss (ISL) needs to be placed ABOVE the HIGH of the Price Bar/Candlestick that penetrated DOWN through the LOW of the First ½ Hour or placed ABOVE the most recent Pivot High (PH), whichever is HIGHER. Profit Objectives (POs): P.O.#1 placed 1.00 ES Point BELOW SHORT Entry; P.O.#2 placed ABOVE the 1.50 Fibonacci Extension of the Total Range of the First ½ Hour; P.O.#3 placed ABOVE the 2.00 Fibonacci Extension of the Total Range of the First ½ Hour. 36

37 Income Generating Strategies Starting the Trading Day After First 1/2 Hour (Post 10:00am ET) What to Look for? How to Think? 1. First 1/2 Hour Breakout Strategy: Penetration of the First ½ Hour (30 Minutes) HIGH or LOW. 2. WAIT for the First ½ Hour potential TREND of the Day to begin. The following criteria MUST BE MET for the TREND to begin: 1) UPSIDE penetration of the HIGH of the First ½ Hour (UP Trend) or DOWNSIDE penetration of the LOW of the First ½ Hour (DOWN Trend). 2) Penetration through the Prior Day s HIGH, LOW, MRAL, or MRAH. 3) Direction of the First ½ Hour Breakout in conjunction with the continuous MFAM: If the Breakout is in the direction of the continuous MFAM, then look to enter into a trade in that direction on a retracement and presume the TREND is in that direction. If the Breakout is contrary to the direction of the continuous MFAM, then look for a Larger Price Move in the direction of the Breakout to occur before Buying and/or Selling in that direction (based on the 2 of 3 criteria required for a Trend change). Trading Concepts, Inc. 37

38 Income Generating Strategies Starting the Trading Day After First ½ Hour (Post 10:00am ET) Continued What to Look For? How to Think? 3. Any potential Trade Setups occurring off of the 30 Minute, 60 Minute, or Daily Charts: An Initial Trend Entry, Successive Trend Entry, or any one of the 3 Powerful Price Patterns found at Longer-Term SUPPORT or RESISTANCE occurring on any one of these Longer-Term Time Frame Charts. 4. Any Trend or Counter-Trend (CT) Trade Set-ups forming based on the Current Day s Price Action: An Initial Trend Entry, Successive Trend Entry, or a Powerful Price Pattern Trade sets up. Has the Trend of the Day begun yet? YES, then LOOK and WAIT for trade set ups and entries into the TREND. Refer to the Initial Trend Entry, Successive Trend Entries, and Powerful Price Pattern Trades modules. NO, then LOOK and WAIT for the TREND to BEGIN. Refer to the Initial Trend Entry module. Trading Concepts, Inc. 38

39 Income Generating Strategies Starting the Trading Day End of First Hour (Around 10:30am ET ± 15 minutes) What to Look For? How to Think? 1. Is there any type of distinguishable TREND of the Day or some type of bias in direction up to this time of day? YES, then wait for a retracement to enter in that direction. NO, then wait for a discernable TREND or bias in direction before trading. 2. If the market is testing the HIGH or LOW of the Day near 10:30am ET, then there may be a Counter- Trend (CT) Set-up (occurs about 90% of the time). General Rule of Thumb: If there is a relatively large move in the First Hour of trading without any significant retracement around 10:30am ET, then you would expect a potential Trending Day in that given direction. If there is a significant retracement (62% to 79% Fibs or possibly even 100%) around 10:30am ET, then you would expect that the market should NOT Trend strongly in either direction. Trading Concepts, Inc. 39

40 Income Generating Strategies Starting the Trading Day Continuously Ask Yourself the Following Questions: 1. What is the Intra-day Trend? UP, DOWN, or SIDEWAYS. 2. What retracement is occurring right now in the Intra-Day Trend? Initial Trend Entry (1 st ) or Successive Trend Entry (2 nd, 3 rd, etc.). 3. What do I need to see in order for a Trade Set-up to occur? The HIGH of the Day needs to be penetrated before BUYING automatically on a retracement or the LOW of the Day needs to be penetrated before SELLING automatically on a retracement. 4. Where are the potential Entries into the Intra-Day Trend, if any? Mid to Lower/Mid to Upper Keltner Channel Bands, Fibonacci Retracements, Moving Averages, Floor Trader Pivots, and/or Powerful Price Patterns. 5. What do I need to see for the Intra-day Trend to Reverse? Mid Keltner penetration UP/DOWN through both Moving Averages in conjunction with the MFAM and/or 62% Fibonacci Retracement of the entire Day. 6. Not Sure What to Do? Wait for the market to tell you what it most likely will do by looking for the market to penetrate UP through the HIGH of the Day or penetrate DOWN through the LOW of the Day. Trading Concepts, Inc. 40

41 No claim is made by the Trading Concepts, Inc. that the Futures trading strategies shown here will result in profits and will not result in losses. Futures trading may not be suitable for all recipients of this Training Program. All comments, trading strategies, techniques, concepts and methods shown within our Course are not and should not be construed as an offer to buy or sell Futures Contracts they are opinions based on market observation and years of experience. Therefore, the thoughts expressed are not guaranteed to produce profits in any way. All Opinions are subject to change without notice. Each Futures trader/investor is responsible for his/her own actions, if any. Your purchase of the Trading Concepts Comprehensive EMINI SUCCESS FORMULA 2.0 Mentoring Program constitutes your agreement to this disclaimer and exempts Trading Concepts from any liability or litigation. Trading Concepts, Inc. 41

42 All rights reserved. This Training Program, or parts thereof, may not be reproduced in any form without the prior written permission of Trading Concepts, Inc. Trading Concepts, Inc. 42