Price is King

Although we have access to a plethora of fancy indicators on your charting platform simply technical analysis of price action support, resistance, and trend still rule supreme.  Price is King!  Tuesday’s, big rally pushed the major right into price resistance levels.  Yesterday, resistance did its job preventing a follow move higher, and the clues to that possibility were evident to those that study price.

If your struggling, try cleaning up your charts and work on the fundamentals of technical analysis.  All those colorful charts sure look impressive but if it’s not making you money,  what’s the point of cluttering a chart with them?  We only make money when the price moves so put more effort into reading price, and your trading will likely improve.  After all, if your account is proving to you that what your doing now isn’t working then its time to make a change don’t you think?

On the Calendar

The Thursday Economic Calendar begins with the Weekly Jobless claims at 8:30 AM Eastern.  According to consensus estimates are expected to come in at 215,000 vs. 214,000 last week.  Also at 8:30 AM is the Philly Fed Business Outlook Survey which expects a slight pullback to 20.0 in October vs. the 22.9 reading in September.  After that, Leading Indicators @ 10:00 AM, EIA Natural Gas report @ 10:30 AM, 6-bond events @ 11:00 AM, 30-yr TIPS Auction at 1:00 PM, with the Fed Balance Sheet and Money Supply coming in @ 4:30 PM.  We have Fed Speakers at 9:00 AM and 12:15 PM today as well.

On the Earnings Calendar, we have the biggest day this week with 82 companies reporting.  Make sure you’re checking reporting dates before entering positions, with about 900 companies reporting next week traders will need to stay focused.

Action Plan

I don’t know if your like me but when the market is tossing about and I have little to no edge to trade, I tend to get a bit frustrated and bored.  That’s a dangerous combination of emotion for a trader!  Taking bad risks simply to have something to do can cause a lot of damage to a traders account.  So what’s a trader to do?  Here are few suggestions that always help me.

Clean up watch lists, work on your charting and trading platform to gain efficiency and learn new skills.  Study, new chart and candlestick patterns digging into the price action of the charts to improve your recognition skills.  Do a detailed review of past losing trades looking for mistakes that you can avoid in the future.  Learn that new a new trading strategy you’ve been putting off or do a deep dive into the details of the indicators you use.  Turn on your paper trade system and practice your price action skills or perhaps develop a new skill such as placing OCO & and conditional orders.  That’s just a few ideas off the top of my head that make times like this more productive, and in the long run make you a better more well-rounded trader.

Trade Wisely,

Doug