Saturday, November 14, 2009

Anatomy of one DeMark-ian trade.

First half of Friday I was in the hurry up and wait mood, market is in no rush to show its true hand (no matter how many failing sectors we see, no matter how many backtest of broken trendlines we spot – until it will play out and we will be on the right side of that trade – the simple truth is that none of it matters)


So, there was I, sitting in front of my state of the art 5 years old Dell Inspiron 6400 Laptop, with only 2Gig of RAM and Intel Dual Core something (not even a “Core Duo”) – did I hear you asking me if I am suicidal? How did you know? Sometimes I am not, so to say “suicidal”, but don’t care about odds … Russians are like Irish – never pass on a bad fight or a good drink.


As you know, I trade mostly on DeMark indicators, I do not claim that these indicators are the best tools out there – they just fit my personality (I am a very bad trend trader and fading is in my blood, thou it does not mean that TD Indicators do not help you trade trend as well)


Below are 3 charts of /NQ showing the only trade I took on Friday (Short /NQ @1791.25 around 12:40PM with OCO – I had to leave, so OCO was the only way since I don’t use trailing stops on futures)


First - /NQ 1800 and 581 tick charts (including aftermarket) – I use tick charts for 24h session – this way I do not miss overnight flow, but not forced to watch “time chart chugging along on 2000 contracts for 17 hours”) – hope that partially answers BalaB‘s question on tick charts.


2009-11-14_1436 2009-11-14_1440


And, finally 3min chart (market hours only) – confirming first 2 charts



Resulting net gain – (1791.25 – 1783.50) =7.75   * $20 = $155 per contract.

Even if only 2 contracts traded (around $7,000 margin req) – profit beats sitting in the cube whole day long with bunch of deadly scared of lay offs slaves.


Now, why am I stressing “one good trade per day”?  Think - .25% tax WILL be adopted and it WILL kill day traders/scalpers (not many real scalpers left after 1/16th departure) – we need to concentrate on MAXIMUM profits with MINIMUM gross proceeds.



Futures approx. BO



Daily Range Projection



















You are still here???

Get out there and trade or at least vote on the poll (thou some people already made it clear that ads are there just for my personal enjoyment), will you? 


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