Day Trading As A Business

The SPX made a bull cycle high at 1709.67 on Friday 8/2/13, followed by the Pi timing week high at 1709.24 [8/5] and then the SPX traded in just a 15 point range the next four days as the index finished -1.1% on the week to 1689.87.

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Last week was extremely low volume as the NYSE volume averaged 629mms, and there was no significant headline news for the media to hype, but it is the doldrums of summer which is not when traders make their greatest profits.

The 15 point trading range last week from Tuesday-Friday was actually much better than it appeared because of the “V” price action which multiplies the day trading opportunities. The actual range was 1700-1685 and it was morning declines and afternoon mark- ups, so there was trading action at both ends of the range [see SPX 5D-5MIN chart below].

SPX Daily 5-Min Chart

I have also included the SPX chart for 8/9 and a few of the Trading Service Focus List trades on 8/9 which are all High Probability-Low Stress strategies with a positive mathematical expectation of success, as I have always pointed out since I first introduced them in 2000 at the start of TradingMarkets. The markets and electronic execution change, but the strategies and symmetry don’t, which is why they remain so successful.

In the SPX chart for 8/9 the index made a 1686.37 low with the -1.0 VB at 1687.82 and was a pullback to the 20DEMA from the 1709.67 bull cycle high, so it was a positive long reversal opportunity with the symmetry.

SPX 8/9/13 Chart

COP is strong Above-the-Line Focus List stock in my trading service and the 66.17 signal bar low at the 816EMA just above the -2.0 VB was a high probability day trade setup. The entry above 66.27 and the -1.5 VB at 66.30 made a strong advance above the 8EMA on the 5 min chart

COP 8/9/13 Chart

PG is another ATL focus stock that was extended to the 816EMA and -2.0 VB and the inside bar reversal above 81.29 advanced to 81.95, which is in-line with its 10D avg. range and the stock’s mean implied volatility –  all of which is available in the Trading Service. The best way to see how it works is to take a Free 1-Week Trial Subscription.

PG 8/9/13 Chart

PG gave us a -1.0 VB opportunity Monday [8/12] after the 81.04 low, with the 20DEMA at 80.88 It was also an RST buy pattern, and the entry above 81.14 was a positive trade that was a very high probability trade selection, and that is how you should run your day trading business.

PG 8/12/13 Chart

CMI is another strong ATL stock with daily chart position at the top of its trading range, so I took the 1st CBO entry above 124.22 [8/12] on the 10:00AM bar, with the daily chart trading range B/O above 124.50. The trade was exited below 125.66 following the 125.84 high at the +1.28 VB, but it went on to make a 126.97 high before closing at 125.84.

CMI 8/12/13 Chart

Trading the right way is a business, but speculating and scalping is not.

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About Kevin Haggerty

From 1990 to 1997, Kevin Haggerty served as Senior Vice President for Equity Trading at Fidelity Capital Markets, Boston, a division of Fidelity Investments. He was responsible for all U.S. institutional Listed, OTC and Option trading in addition to all major Exchange Floor Executions. For a free trial to Kevin’s Daily Trading Report, please click here.

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