Rabu, 13 Juli 2011

Trading a Tired Market

I woke up this morning to see everything sharply UNCH. We are lucky here in the foothills of one of the greatest ski areas in the world - usually no or low humidity. Yesterday was the first humid day for quite a while, so of course it had to be got rid of in the form of rain. It bucketed and now the sun is shining again.


But back to the unchanged markets. Unchanged overnight means that the markets are in balance. The last two days have been so active that everyone has tired out. I still need to make a quid, so what I do is drop down the size of my range bars or Renko and trade for smaller targets. I expect rotation for a while until something comes along to kick price to a new level, but until that happens I make hay while the sun shines. Typically on days like this I manually add trades to Flo's picks as Flo trades in a very structured manner. I could load a different algo into Flo - it's a simple 2 click step - for this type of market but as it's so quiet I like to have more to do.


Today I went to one of my favourites, the DAX. It's very volatile and moves 100 Euros in a blink. The 2 point DAX Renko is tailor made for this type of trading. I just find a short trend and trade the pullback and take profits quickly. It's all about the context and vision.


The first hour and a half gave 8 trades. It started slowly, but then started trending and I made my day very quickly. 


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