(See Above) Today was the first official day trading with the new calibration settings for the Momentum Breakout System and you can see that we caught a lot better traction than normal even in this dull market that we are trapped in. The system issued 11 alerts that triggered entries and you can see that the system caught the 3 main thrusts of the morning. Our main goal when getting filled on every trade is get to a 3-tick delta neutral target and cut the position in half. One thing I want you to notice is how the traction deteriorated after the 3 hour mark from the open. The first 3 hours of the trading session is the sweet spot of the day and typically the best time to trade. If you can bag good points during that time it makes sense to close up shop and lock in your gains. The longer you hang around in a dull market, the more likely you are to give it all back. Today is a great example of this. Notice all the big traction was achieved in the first 3 hours and then things got choppy sloppy. Larger lot traders 10-20 contracts have the luxury of scaling position sizes way down if they are going to continue to trade past this 3 hour mark and then quit at the first signs of poor follow-through. Small lot traders (1-2) are better off finishing up early.
(See Above) Tuesday we saw a medium range down day that gave us ample alerts to get short and play the down move. The first trade out of the gate we got sucked into a false move which led to a quick full stop-out, but things improved after that.
(See Above) Wednesday ended up being a slow grind on low momentum which makes getting our trades to a 3-tick delta neutral especially difficult. The best trade of the day was the first one out of the gate. Later we got suckered into a false rerversal in the market and had a full stop on a short trade.
(See Above) Thursday was a high volatility chop day with low traction. The system got us into 3 trades that ran to give about 2.5 points of traction each.
(See Above) Friday the market went into a light accumulation run shortly after the open and the system signaled us long. I announced in the Market Commentary section of the alert software I was going for a 1-shot, 1-kill trade and closing up shop for the week. We caught the long entry and I alerted everyone to hang on for the Full Monte Macro target so we could go out with a bang. We experienced 5 points of traction with almost no drawdown to capture a quick 3-4 points depending on entry.
Weekly Summary – Performance Stats For Week Of August 1, 2016
(See Above) It was another extremely tough market to trade this week. Even though the graph above shows relatively high overall traction, the market threw us a lot of curve balls along the way and many of the trades had poor follow-through. Sudden reversals were common place. There were 4 full stop outs which is on the high side for a trading week. The general market remains trapped in a tight range up all time highs with depressed daily ranges and limited trade traction. It took an extremely nimble trader play the traction we did get exposed to.
Related Article: Understanding How Different Market Day Types Affect Trading