Part V - Cornerstones of a Sound Trading Plan | Prudent Trader

Part V - Cornerstones of a Sound Trading Plan Prudent Trader

Observe & Trade

Showing a 2-min. chart from DIA (YM in e-mini futures).

It open below but turn to bullish mode after a couple of hours into the trading.

In trading, the first hour is the volatile part.

You can notice, the bears and the bulls are tagging each other until the bulls overcome the battle.

The safe entry is at 114.75 with the ascending 20MA as the confirmation.

Exit at 115.15 for a gain of +$0.40 per share.

Observe & Trade

The market made a dramatic "u" turn today to a bullish mode.

The three core index charts shows how they reacted simultaneously.

Trading them at the open can make you a fast money.

They can be relayed upon to the e-minis.

Monitoring these core index in a multiple screen can give you an edge in your trading.

Observe & Trade

As observed from these two chart in reference to the time frame.

You can see the difference how you can make a best setup (trade).

Using multiple time frame plays a big difference especially if you are a short term trader.

Comparing the one-min. and the two-min. time frame, you can easily spot when and where you can enter and exit.

In this probable trade, referring to the 2-min. chart as your base of recognition, you can conclude that you can short it from the pointed area.

And your best entry can be based from the one-min. chart that specifies clearly, in this case at around 3:15 pm. est. or at the price of 54.48 (the one under the descending 20MA).

Using multiple time frame can make you an "edge" in trading.

As they said in trading, if you don't know your "edge", you don't have one.

So in trading, know your "edge"!

Part IV - The Power of Compounding | Prudent Trader

Part IV - The Power of Compounding Prudent Trader

Observe & Trade

Showing this 5-min. chart from Russell 2000 (TF), one can easily observe that this is a candidate for a short trade.

From the previous close, it opens up but stay below the pivot from thereon until it offers a short confirmation two hours before the close.

Monitoring the market the whole trading day needs a lot of patience, that's how in trading.

Observe & Trade

As observed from this 5-min. chart from Russell 2000 (TF), a low risk short trade is probable.

From the previous trading closing area (the previous arrow), and from the opening with a new high of 799.50 points.

By observing this chart pattern and by combining the previous closing chart, you can conclude that this is an HS pattern.

Likewise the descending 20 ema is a short trade confirmation, plus the previous close was broken at the last hour of trading.

By taking a last hour short trade is a sure fire to bank some money (777.00 - 773.00 = 4 points). TF moves 0.10 points per $10.00, that's +$400.00 bucks profit.

Not bad for the last hour trade.

As the great trader say, "waiting and sitting" coupled with Observing is the way to Trade!