At 3pm EST some bond traders make their adjustments in the S&P Depending on the move, this used to be called the "bond bounce" The formula for this used to be whatever direction the S&P showed during the prior 30 minutes, the bond would "bounce" in the opposite direction from 3pm on..(15 min duration).
Today after regular market hours, I received a question from ET member Bernard111 asking about the "Bond Bounce" Rather than go through all the details I will simply give an update as to how the setup should be approached in the current market. First, the setup begins at 3:00 EST. At that time Bond Traders will tend to show up in the S&P market to adjust (read hedge) their positions. Starting with 3PM EST watch to see if the ES contract moves directionally (predominately up or down) until 3:30 At 3:30, the market will tend to "bounce" or reverse for approximately 15 minutes. If we use today's ES chart with 5 minute candles, you can see how this might work as a trade setup. From 15:00 (3:00 EST) the market moved down from 1284 to 1278..... From 15:30 to 15:45 the market reversed moving from 1278 to a high of 1284.... There it is, the "bond bounce" Now be aware that this bounce does not happen every day, no setup works perfectly. Also, there are several ways to play the "bond bounce". I have simply suggested the one that would be easiest for newbies to use. I suggest those who want to learn more about it start to do their own research to learn how the bond is traded by institutions and speculators. Please refer to this chart of today's action
not true...... its important that you have a bias... one that the market is flat or near flat..... let the market prove to you otherwise before you hit the buy or sell button. Use this rule for any time frame and the $$$ will be a little closer to your reach!
I rarely daytrade and I'm definitely not struggling, but I just wanted to say thanks to steve46 for his efforts in this thread. It's nice to have some real trading ideas without a lot of crap to wade through. Good trading to all.
Well if that works for you, fine. One problem that newbies have (perhaps with over 800 posts you aren't a newbie) is that they will committ to a trade and then hang on while it moves against them significantly. This is an example of unproductive bias. I think one should have no bias. Simply trade what they see on the screen mechanically. Either the setup qualifies or it does not. Either the trade works right away or it does not. The position either makes a profit or it is stopped out at a specific price point. Speaking for myself, I like to keep a record of how each trade acts. The data is compiled into a monthly study that shows me how the setups are performing. Nice to hear from you Lilduckling. I hope that helps you. Steve
Thank you Wayne for the kind words My goal is to help everyone if possible, but I try to direct my comments primarily to new traders. I remember how difficult it was to get good information starting out. Your comments are always welcome. Steve
Very important IMHO. Whether you trade automated, or based on signals, or "feel". or whatever you NEED to log those trades. All of them. Date, time, basis, entry, exit, notes, etc. It's just a great way to see what is working best and what needs more attention. Plus it can help greatly later on for taxes. Grab a new or old copy of Excel, or an open source freebie, whatever - it doesn't have to cost much - and dig into it. Run studies and graphs. Find your profit factors, win pcntg, etc. Yeah it takes some work, but I have yet to see a successful trader that didn't work his/her butt off...
Yes Agreed, and that takes me into another aspect of this business and that is research. My contention is that one of the reasons that traders struggle is that they do not do their own research. Instead most of you simply use whatever "seems" to work, and is being used by other retail traders. Also one has to take into consideration the temperment of the trader. Some of us are not cut out to be intraday traders. We may not want to sit in front of a trading screen all day. We may have other jobs and wish to trade part time. In addition we all have different tolerance for risk. These are but a few of the important issues that traders should resolve on their own before starting to trader. Unfortunately they almost never do this important work until they have lost significant amounts of money. My own recommendation is that new traders start by learning some basic skills. 1. How to use a spreadsheet (Excel for instance) 2. Learn basic parametric statistics (take a class if you have to) 3. Pick a computer language and learn it (Basic, Pascal, C, Perl whatever, just pick one and start to learn how to program 4. Read....Read about the various ways to test markets On this subject I have plenty to say, but I will keep it brief. In my opinion "backtesting" as it is implemented in by most people, does not work....I suggest that people learn to do what I call "characterizing" the market....My advice is to start by reading a book by Clifford Sherry titled "The Mathematics of Technical Analysis". I hope this helps Steve
Ok for the new traders on the site, unfortunately we have "trolls" here. They try to disrupt and stop YOU from doing what you want to do here on ET. A group of us have agreed to "ignore" them. To find the "Ignore" feature, go to My Account and then to Edit Options. Put the name of the troll in place and you will not see their posts again. Alternatively you can simply ignore their posts. An informational post titled "Trader28 information Thread" is located in Feedback forum. All of us appreciate your help in keeping ET free of trolls. Best Regards Steve