Jake BernsteinMarket Mastery Series II (MMS II)

www.jakebernstein.com

Profits from Process and SelectivitySaturday 22 September 2012Saturday 22 September 2012

Session 7 Spike resistance and support continued My HFT experiment: update

Fi di d t di t iti Finding and trading opportunities 30 MBO Trades : Review of each day P/L Divergence Buy Setups and Triggers in Process Trades for the Last Week: How they turned outy Trades for the Coming Week: What I see by the Rules Sep Seasonals and Oct Seasonals Thursday – Friday Euro - Outcome and Trade this Week Friday Monday Gold Trade Friday-Monday Gold Trade

© 2012 by Jake Bernstein 800-678-5253 831-430-0600

Get your facts first, then you can distort them as you please

Mark TwainMark Twain

Saturday 22 September 2012Session 7Session 7

Spike resistance and support continued My HFT experiment: update My HFT experiment: update Finding and trading opportunities 30 MBO Trades : Review of each day P/L Divergence Buy Setups and Triggers in Process Divergence Buy Setups and Triggers in Process Trades for the Last Week: How they turned out Trades for the Coming Week: What I see by the Rules Sep Seasonals and Oct Seasonals Thursday – Friday Euro - Outcome and Trade this Week Friday-Monday Gold Trade

Last two sessions: goals Summarize methods and procedures Provide clear and objective examples Pick trades in advance and follow through Respond to questionsp q Address trading behavior issues Emphasize focus and selection process Emphasize focus and selection process Clarify details of implementation

Are we on track for our goals?To simplify the seemingly complex (Y)To FOCUS on process and procedure (Y)Th DECISION MAKNG (Y)The DECISION-MAKNG process (Y)How to IMPLEMENT (Y)How to ORGANIZE (Y)How to ORGANIZE (Y)How much time to spend each day (Y)Roadblocks (Y)( )Trade by trade REVIEW and PREVIEW (Y)Stocks, futures, spreads (Y)

My job: convince you by repetition and consistencyand consistency

Your job: make me proud

Methods, systems, process MAC Swing trade MAC Swing trade 30 MBO

Seasonals Seasonals Shorter term spreads (< 40 days) why 8OC GAPS (primarily in stocks) MD Fri-Mon Gold Thurs – Fri Euro FX

My trading list – futures

Soybeans (meal or oil) ES1 (30 mbo) ES1 (30 mbo) TBonds or TNotes (10)

E ro A s$ or Canada$ (DX) Euro, Aus$ or Canada$ (DX) Gold (full or mini) Sugar LC or LH Cocoa Crude oil (full or mini)Crude oil (full or mini)

I received numerous questions about my I received numerous questions about my “spike support” and “spike resistance” concept – primarily about how and when toconcept – primarily about how and when to use it.

Here is a synopsis and a few more examples Here is a synopsis and a few more examples

Definition and conceptual overview What is spike resistance? “Cellular memory” the why The low of a high price bar serves as

resistance when prices turn higher 6 bar filter The entire bar can pose resistancee e t e ba ca pose es sta ce Successive closings above spike resistance

tends to be very bullish – works better fortends to be very bullish works better for buys - why

Vice-versa for spike support Vice versa for spike support Examples

Where many see great opportunity and Where many see great opportunity and profits I see a great opportunity to do the opposite to make a profit where many seeopposite to make a profit…where many see catastrophe and have fear I see the opportunity to profit and I call up myopportunity to profit and I call up my courage…ONLY triggers will turn opportunity into action and enhance courageg

JB

Fi di t itiFinding opportunities

The love / hate syndrome in markets The love / hate syndrome in markets Two classic examples courtesy Zuck last week This week they hate QCOR Why? How to find out but who cares? How did we find it? Filters on Genesis Nasdaq list of largest gainers / losers

I always ask “what do I know”I always ask what do I know as opposed to “what do I think

h f i h”or assume or hope for or wish”

What did I know or not knowBi d li (I id b k t ) Big decline on news (I avoid bankruptcy news)

Massive selling and panic HUGE volume spike (over 2000%) HUGE volume spike (over 2000%) That with HFT and electronic trading markets moves faster

than ever To capture an intraday bounce or more I would need very

short term intraday chart1 i i id l f f t d t t d t f t 1 min is ideal for fast moves and most traders are not fast enough so my main competition is the HFT but we do different things so I’m not concerned g

I chose 1 min (my usual choice in such cases) CAN USE tick charts as well

I saw no MACD or MOM divergence I saw no MACD or MOM divergence So I have to use 2 other tools

8OC and / or MAC 8OC and / or MAC I also know that I do not want to be a seller I will only take buy signals to enter day trades Let’s look at a few charts

8OC 1 min QCOR

Later the same day

JCP this Wed

FB how it turned out

Will you be surprised if…

Is everything “normal” in S&P?

$4 780 44 start; then 11 858 this week $14 463 HFT$4,780.44 start; then 11,858 this week $14,463 HFT

What was “special” about 17 Sep?

A closer look at 17 Sep

My HFT day trades and status

30 i b k t ES130 min breakout ES1

I had a request to show 30 mbo trades using I had a request to show 30 mbo trades using 3 unitsA di l ill l k t th t t d Accordingly we will look at that today

“The 30 minute breakout doesn’t seem to be ki ll tl I thi d t thworking very well recently. Is this due to the

fact the volume and volatility are so low? “

Mon

Tues

Wed

Thurs

Fri

F i M G ldFri-Mon Gold

Weekly GC Mac up Weekly GC Mac up Buy Fri open (Thurs afternoon) Stop and PT1 10 bar largest range day If loss Fri on close exit all If profit exit 1 Exit 1 Mon open (Sun afternoon)p ( ) Last position 75%TS BES and/or exit on

closeclose

FMG this week

Last 2 and 3 weeks agoLast 2 and 3 weeks ago

Last week

I rarely get mad…I have a long fuse but sometimes a 4 letter word appealsbut sometimes a 4 letter word appeals to me…

“Hey Jake your Friday Monday gold trade Hey Jake your Friday-Monday gold trade really sucked big time this week. It came back way fast from the high and I only madeback way fast from the high and I only made a few hundred bucks on it. You need to figure out a better way to get out at the highfigure out a better way to get out at the high of moves like this one dude. Very disappointing…”pp g

(Name and initials turned over to the Taliban)

Thurs-Fri Euro this week NT

Mentoring appointment interviewhttp://www comtrade1 com/letter/ http://www.comtrade1.com/letter/

MMS sessions are recorded

I can be reached at 800-678-5253 or 831-430-0600 Email me if you have questions: jake@trade-futures com jake@trade-futures.com Best of trading Jake Bernstein

© 2012 by Jake Bernsteinwww.trade-futures.com 800-678-5253 * 831-430-0600