does the DAX lead or lag the ES?...I would think DAX leads overnight and then about 9:30AM when US RTH begins...then, ES leads DAX...what do you think???so kinda a "Wash"?
Depends on which trading day your talking about and I'm being very serious. Simply, trying to develop a method out of which leads which without understanding the entire market dynamics will be a losing effort. Thus, the real question is what causes the DAX to produce swing points or strong continuation price action and do the same for the ES. Once you understand these reasons why they do what they do (it has nothing to do with one leading the other)... You'll be traveling along that road of consistent profits... Along with being much better prepared to trade in comparison to trying to determine if one trading instrument leads another. Then again, we've had this discussion with you before about this particular topic many months ago and you've now asked the same question again involving a different trading instrument. My question to you is this... Has it been profitable via this approach since you've last asked this questions many months ago??? Mark
The secret is to be long when the market is rising....and to be short when the market is dropping..... This is the holy grail.
It's easy to determine with 75-80% accuracy where the ES is going for the first 15-30 minutes. After that I don't care, I just look for decent setups. Good luck on that perfect system thing because what works now won't in 6 months. Trading is a constantly changing endeavor. Lots of screen time is the ONLY thing that will assist you in getting better. Over analyzing usually leads to poorer results. Just remember, things that look really great after the fact usually are very indecisive while they're occurring in the heat of the battle.
In all seriousness the best stance is to start the day with no bias outside of your anchor chart. As the day develops complement the anchor chart with the intraday one. Remember that most pre-market moves happen on low volume. Let the day play itself a bit before stepping into the jungle as anything with low volume usually misleads. Anek
increase, Are you looking for predictive indicators or reactive ones? The S&P futures being down 50 at the open(930) obviously suggests the market will be down for the day (greater probability), but it does not tell you whether it is going to close higher that it opens at, or lower than that, and by how much; I believe the latter is what a trader should be interested in. For that you need to do your own homework.
Leading indicators change frequently. At one point in this bull market the dow futures were in charge. Now not the case. The nq futures are imho the lead dog now when programs hit(volume has increased alot in the nq and qqqq compared to es spy ratio in last month). Intermarket relationships change also. The yen is highly correlated inversely with us stock indices as well as gold,crude etc. Carry trade unwinding creates fast moves in us stock indices as hedge funds and quant shops etc. close positions. Price of the yen and us bonds across the curve are also postively correlated in a high risk environment like we are in now. These relationships can change and that's what a good trader can pick up on. Our goal is to spot the change before the herd does and adapt our trading style to changing market conditions.