Live Trading Room Transcript Sample

08:55 @Kelly: Good Morning Traders, October 1st 2007
08:55 @Kelly: Click Here for Next Chart
08:58 LJ: Click Here for Next Chart
09:00 @Kelly: Click Here for Next Chart
09:04 @Kelly: Click Here for Next Chart
09:07 @Kelly: We still have quite a bit of coiling in the markets coming into today
09:08 LJ: Click Here for Next Chart
09:08 @Kelly: Light news day today
09:08 @Kelly: ISM Mfg Index
09:08 LJ: Click Here for Next Chart
09:09 LJ: Click Here for Next Chart
09:09 LJ: Click Here for Next Chart
09:11 LJ: Click Here for Next Chart
09:14 @Leslie: good morning, as kelly said, market has been coiling last few days
09:14 @Leslie: the 1542 area has been an area of resistance last few days also
09:14 @Leslie: we want to keep an eye on that area
09:15 @Leslie: there is no pattern off the open that I see
09:15 @Leslie: we will be patient and wait for a set up
09:16 @Leslie: possibly a sell around 1545, but we will see how price reacts if it moves up to that area
09:31 @Kelly: ES opens at 1539.25
09:31 @Kelly: close to Friday's close
09:40 @Leslie: steady up off open so far
09:44 @Leslie: dow index is above fridays highs
09:46 @Leslie: good size 15 min bar off open
09:48 @Leslie: will look for pullback to buy or ab=cd buy pattern
09:55 @Kelly: Es has taken out Fridays high off the open, strong move so far
09:57 @Kelly: Naz and Rut havent quite
10:03 @Leslie: was looking around 1544 for potential buy
10:03 @Leslie: flushed very quickly to 1544.50 and moved up
10:03 @Leslie: we will watch for ab=cd pattern or next pullback
10:09 @Leslie: have not had much of a pullback
10:10 @Leslie: we have been seeing the market forming a coil last few days
10:10 @Leslie: and this looks as though it is move outside of the coil
10:10 @Leslie: we want to look for a buy opportunity
10:10 @Kelly: Rut has now taken out its Friday hi
10:10 @Leslie: do not want to sell unless there is a failure such as first hour low taken out
10:11 @Leslie: 2.25 pts was first pullback
10:11 @Leslie: we will look for a pullback in that range
10:11 @Leslie: ticks have been staying above the zero line
10:11 @Leslie: that is bullish
10:12 @Kelly: Click Here for Next Chart
10:12 @Kelly: a move above 1552 will further confirm this move up
10:13 @Kelly: Dow is very strong today
10:14 rory: what pullback would we look for at this point ...good morning
10:14 LJ: Click Here for Next Chart
10:15 @Kelly: rory, a pullback with a pattern such as an ab-cd
10:16 @Leslie: the pullback in points based on last pullbacks around 2-3 pts
10:16 LJ: Click Here for Next Chart
10:16 @Leslie: ab=cd pattern is preferable
10:16 rory: thanks
10:18 LJ: Click Here for Next Chart
10:19 @Leslie: 1552 were the highs from fomc announcment
10:20 @Kelly: Click Here for Next Chart
10:20 @Kelly: Advance Decliners are strong this morning as well
10:21 @Leslie: dow index is very close to previous highs
10:22 @Leslie: always one in every crowd....nazdaq futures not above fridays high yet
10:25 LJ: Click Here for Next Chart
10:26 @Leslie: es got 2.25 pullback same as last pullback, we are watching for ab=cd pattern to form
10:26 @Kelly: 2.25 has been the largest pullback so far today
10:26 @Leslie: 1546.5 with 3 pt stop
10:26 @Leslie: give or take a tick or two on that entry
10:28 @Leslie: I want to quickly show you how watching the market internals this morning and having followed the market coiling saved from entering a trade that would have been stopped out as a loss....
10:28 LJ: Click Here for Next Chart
10:29 LJ: Click Here for Next Chart
10:29 @Leslie: there was 127 and ab=cd sell pattern completing in same area
10:29 @Leslie: but this setup was passed on because of long 15 min bar off open to upside
10:29 @Leslie: adv dec were strong
10:29 @Leslie: ticks holding above zero
10:30 @Leslie: and other indexes strong
10:30 @Leslie: I have order in for 1546.75 buy
10:32 @Kelly: Click Here for Next Chart
10:32 Kellye: thanks for the explanation Leslie
10:32 ellyh: that's a nuance!
10:32 @Kelly: Dow has retested its hi on this push up today
10:32 ellyh: thks
10:33 @Leslie: 3.5 stop with 1546.75 entry
10:34 @Leslie: this is a small pattern and will take partials aroud 1 pt
10:34 @Leslie: see if price can make a test of highs or make new highs
10:34 @Leslie: leaving stop at initial for now
10:36 @Leslie: yw Kellye and ellyh!
10:36 @Leslie: that is a nuance!
10:36 @Leslie: will sell out another partial around a test of highs
10:36 @Leslie: 1549-1549.75
10:39 @Leslie: selling partial here
10:40 LJ: Click Here for Next Chart
10:40 @Leslie: stop breakeven now
10:40 @Leslie: will rebuy a little lower if it gets below last small low
10:41 @Leslie: if not still holding partial for potential higher prices
10:41 @Kelly: 3.25 largest pullback today, again very strong
10:41 LJ: Click Here for Next Chart
10:41 Tsam: LJ - my 400 tick macd looks completely different - can I post?
10:41 @Leslie: sure, go ahead tsam
10:41 Tsam:Click Here for Next Chart
10:41 @Kelly: Click Here for Next Chart
10:42 Tsam: why does it look opposite yours? are my settings off?
10:42 @Leslie: I will post properties and you can check
10:43 Tsam: k, tks
10:43 LJ: Click Here for Next Chart
10:43 @Leslie: properties are also listed on website for various settings
10:44 Tsam: hmm, mine are exactly the same
10:44 @Leslie: 1545.50 area for next buy
10:44 @Leslie: are you using globex tick data?
10:44 @Leslie: have you kept the charts running?
10:44 @Leslie: have not shut off program or computer?
10:45 Tsam: I just check off -400 for my tick data
10:45 Tsam: day session only is not checked
10:45 @Leslie: that is globex then
10:46 Tsam: yes, sept 30 bars are in there - we can address it later if u want to focus on trading - strange is so different than yours
10:46 @Leslie: tsam could you put up your properties in window?
10:46 Tsam: ok
10:46 Tsam: Click Here for Next Chart
10:47 @Leslie: i'll come back in a bit and look at the properties
10:47 Tsam: ok, tks LJ
10:49 @Leslie: any move below 1546.50 is a buy
10:52 @Leslie: aggressive buy in here
10:52 @Leslie: can still get a bit lower, so using partials in here
10:53 @Leslie: 1548
10:53 @Leslie: will buy other half 1545.75
10:53 @Leslie: and place 3 pt stop on whole position
10:53 @Leslie: ok
10:55 @Leslie: will sell partial of partial at 1549-1549.50
10:57 @Leslie: giving it another minute to trade through 1549
10:58 @Leslie: will take partial in a minute if not filled 1549
10:59 @Leslie: took of partial breakeven
11:00 @Leslie: could not quite get through 1549 on that push up
11:06 @Leslie: nazdaq is still not above fridays highs
11:06 @Leslie: that had been stronger index last couple of weeks
11:06 LJ: Click Here for Next Chart
11:08 @Leslie: es has just been doing a small sideways consolidation
11:08 @Leslie: has not pulled back much
11:09 LJ: Click Here for Next Chart
11:10 @Leslie: that type of consolidation following a strong upmove is usuallly bullish
11:14 @Leslie: still selling out some 1549-1549.50
11:14 @Leslie: stop 1548 now
11:16 @Leslie: turnip trade
11:16 @Leslie: should go now
11:17 rory: you think its to late for me to jump into a buy (just came back)
11:18 @Leslie: can try using one tick above highs
11:18 @Leslie: that would be first hour range
11:18 @Leslie: but there was no narrow range day on friday
11:18 @Leslie: it is more aggressive buy
11:18 @Leslie: and your stop would go 1546.25
11:19 @Leslie: es is up at resistance in this area
11:20 @Leslie: it has been consolidating the morning move up
11:20 @Leslie: with only a 3.25 pullback so far
11:20 @Leslie: dow index is very close to the highs
11:21 @Leslie: 14022
11:21 @Leslie: had a high of 14008
11:21 @Leslie: would like to see it blast through then buy pullback
11:23 @Leslie: on that type of setup rory you would have to take some partials out sooner than later
11:23 @Leslie: 1552 is previous high from fomc announcement and is a resistance area right now
11:23 rory: will wait for a potential sell I think
11:24 @Leslie: for a sell today, I would wait for a failure
11:24 @Leslie: then sell first reaction or ab=cd
11:25 @Leslie: if es can make it through 1552 then 1556 is 886 retracement and a 127 at 1561
11:26 LJ: Click Here for Next Chart
11:27 @Leslie: looking at longer time frame bar up is long bar
11:27 LJ: Click Here for Next Chart
11:27 @Leslie: coming out of coiling patterns
11:27 @Leslie: and has not been able to pullback much today, that is why will not sell unless a failure somewhee
11:28 rory: got it thanks
11:28 LJ: Click Here for Next Chart
11:28 @Leslie: there is the 886 retracement around 1556
11:29 @Leslie: lets not forget, we did not get whacked taking a sell that had a low probability of working
11:29 @Leslie: we made a few points on first buy
11:29 @Leslie: and latte trade on second buy
11:29 @Leslie: that is not a bad day
11:31 LJ: Click Here for Next Chart
11:32 @Leslie: we have been watching how this inverse head and shoulder pattern has been playing out
11:35 @Leslie: 1551 area to 1551.50 would be a first exit area for buying one tick above highs or the first hour range high.
11:35 @Leslie: I did not call that as official setup in here, pointed it out to rory, and just showing you how it would be managed
11:36 @Leslie: all indexes making highs
11:36 @Leslie: getting close to the 1552
11:36 @Leslie: will see how price reacts there
11:36 @Leslie: momentum has been up today
11:36 @Leslie: still would look for pullback to buy and I will post any
11:49 @Leslie: es made it to previous fomc highs
11:50 @Leslie: if you are long would keep stop about 1547 for now and see if it can get up to the 1556
11:50 @Leslie: its not getting immediate resistance at 1552
11:51 @Leslie: russell still below fomc
11:53 rory: thank you for putting me straight on a potential poor decision....I put a buy instead and made a nice little profit and have to run errands...thanks again..
11:54 @Leslie: yw rory!
11:54 @Leslie: will watch for antoher pullback to buy
11:54 @Leslie: possibly around 1548-1549
11:54 rory: sorry now have to run errands...no Kudos to you!!! bye
11:54 @Leslie: or 3-4 pt pullback
11:55 @Leslie: if you are long, just stay long
11:55 @Leslie: this could trend up until close
11:55 @Leslie: could get to 1561 also
11:56 @Leslie: 1550 was morning high of first hour range, this should be support now
11:58 LJ: Click Here for Next Chart
11:59 LJ: Click Here for Next Chart
12:00 @Leslie: watching for pullack to buy
12:00 @Leslie: may not get much
12:01 @Kelly: Naz finally caught up with the pack and pushed above its Friday high
12:02 @Leslie: dow is holding above the previous highs
12:04 @Leslie: 1551 area pullback right now
12:06 @Leslie: going to buy partial in here
12:06 @Kelly: indicators still confirming the move up
12:07 ellyh: i'm confused...you are buying 1551 or right now?
12:08 @Leslie: in here
12:08 @Kelly: Click Here for Next Chart
12:08 @Kelly: Advance Decliners are making new highs
12:10 LJ: Click Here for Next Chart
12:10 @Leslie: using the tick pullback
12:10 @Leslie: will also buy partial around 1551 area
12:20 @Leslie: partial around 1554.50
12:20 @Leslie: partial in here
12:21 @Leslie: stop is at 1550
12:22 @Leslie: exit around 1555.50-1556
12:22 @Leslie: stop 1552 if not filled
12:23 @Leslie: I will go over that trade with you, let post a chart....
12:25 @Leslie: exit in here
12:26 LJ: Click Here for Next Chart
12:27 LJ: Click Here for Next Chart
12:28 @Leslie: there is a chart showing the entry area and a chart showing the ticks
12:28 @Leslie: the ticks have been holding above the zero line most of the day
12:28 @Leslie: with a few small tick flushes below the zero line
12:28 @Leslie: when trends progress they can get shallower retracements
12:29 @Leslie: and sometimes you can use the tick pullback for entry
12:31 @Leslie: es has had shallow retracements today
12:31 @Leslie: this is trend day up
12:32 @Leslie: still looking around 1551-1551.50 for another buy
12:36 @Kelly: largest pullback today is still only 3.25 points
12:38 LJ: Click Here for Next Chart
12:38 @Leslie: if this gets to 1552 will buy with 3.5 stop
12:39 LJ: Click Here for Next Chart
12:42 @Leslie: I want to show you another example of a somewhat failed pattern, if you had used the market internals then you would be aware of trend conditions and can manage this setup accordingly....
12:42 LJ: Click Here for Next Chart
12:42 @Leslie: there was 3 drive pattern
12:43 @Leslie: as we have gone over before, this pattern does not always mean a trend reversal
12:43 @Leslie: in a trend it can just signal a more complex correction such as an ab=cd pattern
12:46 @Leslie: which is what happened with this 3 drive pattern
12:58 @Leslie: buy area 1552 - 1552.50
13:12 @Leslie: 2.75 pullback so far
13:12 @Leslie: got to one tick away from 1552.50 entry
13:12 @Leslie: see if it can make a push down there
13:14 @Kelly: may get a small ab-cd too
13:14 @Kelly: Click Here for Next Chart
13:16 @Leslie: this has been a good move up today, pullbacks have been very shallow
13:16 @Leslie: I have a rule about day like today; I do not do countertrend trades on trend days
13:16 @Leslie: the probability of success goes way down
13:17 @Leslie: usually the next day in the morning is better time for countertrend
13:20 @Leslie: cancel the 1552.50 for now
13:22 @Leslie: es hit the 886 retracement
13:22 @Leslie: any longs that are holding until close would put stops 1548
13:25 @Leslie: earlier someone pm'd me about using 3 part scale out exit versus one or two
13:26 @Leslie: the time to use a 3 part or more scale out is in trending conditions when you can see larger potential exit areas
13:26 @Leslie: during range trading days it usually will not pay over the long run use a 3 part scale out, the trader will end up over the long run, giving back to much in profits.
13:26 @Leslie: On range trading days use a one or two part scale out for profit targets
13:29 @Leslie: tick highs here
13:29 @Leslie: we want to continue looking for a pullback entry
13:29 @Leslie: this is like a creeper trend up and these are the most dangerous types of trend for countertrend traders
13:30 @Leslie: they think it has gone "too high" and try and short, it stalls out, they are convinced it will turn down, it turns up, matter of time before pain threshold gets hit (known as puke level) and bail out with loss
13:32 @Leslie: and many traders can get into a revenge trading mindset and continue trying to sell it and have an absolutely disastrous day
13:32 @Leslie: good thing that never happened to me:)
13:32 ellyh: lol
13:33 ellyh: or you'd be out hacking down trees Leslie!
13:34 @Leslie: trees, bushes, telephone poles...
13:34 @Leslie: main goal for a counter trend trader is to NOT lose money on a trend day
13:37 @Leslie: possible the 1555 area for a buy
13:37 @Leslie: again if you are long, hold until close
13:38 @Leslie: stop on any longs can go 1549 for now
13:39 @Leslie: have not even seen a fib retracement from the days lows at 1539
13:40 @Leslie: in a trend sometimes you will only get a .382 retracement from the open price
13:40 LJ: Click Here for Next Chart
13:41 LJ: Click Here for Next Chart
13:41 @Leslie: a 3.25 pt retracement would be around 1555
13:42 @Leslie: 1579 were the previous contract highs from july
13:50 @Leslie: took nazdaq a little bit to get going and join the party, but it is also trending
13:50 @Leslie: there is a large 127 on nazdaq futures at 274
13:50 @Leslie: 2174
13:52 @Leslie: we said last week not to get long term bearish on markets until you see some real failures, there are the larger longer term patterns still playing out
14:01 @Leslie: watching for small ab=cd buy pattern
14:02 LJ: Click Here for Next Chart
14:02 @Leslie: if it does not make new highs will watch for this completion
14:03 @Leslie: 1555.50-1556
14:12 @Leslie: any longs holding until close can move stop to 1552
14:15 @Leslie: still watching for little ab=cd
14:16 LJ: Click Here for Next Chart
14:16 @Leslie: here is chart posted end of last week showing the coiling
14:16 @Kelly: again, the largest retracement is still only 3.25 points, very strong
14:17 @Leslie: that is the dow 400 tick chart
14:17 @Leslie: dow has had very shallow pullbacks
14:17 @Leslie: 1556 area still good area for pullback
14:19 @Leslie: if anyone is logging on late and can not see postings from this morning then you can refresh; right click anywhere in window, choose refresh, choose 250
14:20 @Leslie: that will bring up transcript for today, you can see start of transcript where you see todays date
14:20 ellyh: printing today out and the charts
14:21 @Leslie: that is good elllyh, today is excellent trend day study
14:21 ellyh: Leslie, I have not stable internet today so have only been able to watch :(
14:21 ellyh: Comcast coming today to fix this dang mess
14:22 @Leslie: I hope they get it fixed for you
14:22 @Leslie: always frustrating with those things
14:22 ellyh: me too, it started last fri....affects my phone line too
14:22 ellyh: it just all shuts off for a few min at a time
14:23 @Leslie: 1556.50 is 3 pt pullback
14:23 @Leslie: that is entry for next pullback right now
14:28 @Leslie: 20.5 range today in es
14:39 @Leslie: thats very funny, missed 1556.50 by a tick
14:40 @Leslie: still could get down a little lower
14:42 @Leslie: or not, lol
14:45 @Leslie: if anyone bought around the 1556.50 this is spot for profits
14:49 @Leslie: grrr
14:50 @Leslie: a market environment like this gives you a little more flexibility on entries, so if we call an area use your own best judgement on exact entry
14:51 ellyh: what a day to miss out on....
14:52 @Leslie: ellyh, lets put a little perspective on this
14:52 ellyh: sure
14:52 @Leslie: it always looks easy in hindsight
14:52 @Leslie: and....theres more
14:52 @Leslie: there will be another
14:53 @Leslie: great trend learning day
14:53 ellyh: I know....and i'm glad I got to see this
14:53 @Leslie: ok, one more little bit of encouragement....
14:53 ellyh: also how to not countertrend trade on a day like this and yo u identified it earlyt on
14:54 ellyh: sorry bout my typing
14:54 @Leslie: "it is better to be out of a market wishing you were in, than in a market wishing you were out"
14:54 ellyh: so true
14:55 @Kelly: Click Here for Next Chart
14:55 @Kelly: pushing above the .886 now
15:00 @Kelly: Here are tomorrow's Economic announcements
15:00 @Leslie: any longs holding until end of day stop can go 1556
15:00 @Kelly: ICSC-UBS Store Sales
7:45ET

Redbook
8:55ET

Pending Home Sales Index
10:00ET

4-Week Bill Auction 1:00ET

Motor Vehicle Sales

4:00ET
15:09 LJ: Click Here for Next Chart
15:09 @Leslie: es made the 127
15:09 @Leslie: at 1561
15:09 @Leslie: does not mean that is a sell there right now
15:10 @Leslie: will not do any sells today unless there is big failure
15:10 @Leslie: and its into last hour
15:10 Delip: In this chart is there any swing coming @ 100% level?
15:11 Kellye: why are you drawing the 1.272 using 1518.95 since price didn't retrace to that point?
15:12 @Leslie: 1518.75 was the low of that swing
15:12 @Leslie: its not showing for some reason on that chart
15:12 @Leslie: so using the full swing
15:12 Kellye: oh
15:13 @Kelly: Click Here for Next Chart
15:13 @Kelly: here it is with the swing low
15:13 LJ: Click Here for Next Chart
15:13 Kellye: ahh, that's better
15:13 @Leslie: it is showing better on this 30 minute chart
15:13 @Leslie: I don't know why it is not on that 60 minute chart
15:13 Delip: Now makes sence.
15:14 @Leslie: ok, good, lol
15:14 @Leslie: sorry about that
15:14 LJ: Click Here for Next Chart
15:15 @Leslie: you can see this leg up and how steep the angle is
15:15 @Leslie: this means we want to look for support areas tomorrow to buy
15:15 Delip: I am not questioning your analysis. I thiught I can do in different way , which I may need to learn.
15:16 @Leslie: no, not at all Delip, just my charts not cooperating:)
15:16 @Leslie: we want to look for potentially a correction of 5-8 pts tomorrow
15:16 Delip: I got the point though.
15:21 ellyh: i;d like to look at the EUR for a potential retrace sale
15:21 ellyh: do you mind posting a chart?
15:22 @Kelly: sure, just a sec..
15:22 @Kelly: Click Here for Next Chart
15:22 @Kelly: Euro has found some support at te .382
15:23 @Kelly: te=the
15:23 ellyh: I thought there might be an ABCD into some fib no
15:24 @Kelly: we may get something at the .786 of this drop down
15:24 @Kelly: Click Here for Next Chart
15:24 ellyh: ok
15:24 @Kelly: nothing super clear at the moment though, ellyh
15:24 ellyh: wasn't that high a weekly completion?
15:24 @Kelly: sure was
15:25 ellyh: k , ty
15:25 @Kelly: Click Here for Next Chart
15:26 @Kelly: Click Here for Next Chart
15:26 @Kelly: it just pushed above the 127 on Friday , 2 year pattern!
15:26 @Kelly: biggie
15:27 @Kelly: We are watchign it this week for another possible short, want to see a good clear pattern with it
15:28 Elly: ok thanks Kelly
15:30 @Kelly: 21.75 range so far today
15:33 @Kelly: For the Start of the month\Start of the quarter\Start of the week...looks like the "powers that be" had on their "To Do" list to be buyers
15:34 @Kelly: will be watching for the market to move up further tomorrow
15:36 @Kelly: this is the largest retracement so far we have had today
15:36 @Kelly: Click Here for Next Chart
15:37 @Kelly: not buying here, so late in day
15:38 @Kelly: if any of you lucky ones are still long, I would move stop up to 1556
15:45 @Kelly: we are getting soem new tick lows on the day
15:46 @Kelly: 5.75 retracement, largest pullback
15:52 @Kelly: We will be watching the .382 of this move up for a possible buy pattern in the morning tomorrow 1550.50-1551
15:52 Elly: ok good
15:52 @Kelly: Click Here for Next Chart
15:52 @Kelly: Click Here for Next Chart
15:53 @Kelly: Es is testing the .886
15:53 @Kelly: Click Here for Next Chart
15:54 @Kelly: and we just pushed off of a larger 127 at 1561 on the 60 minute chart
15:59 @Kelly: It is very likely we will see that 1561level tested if not surpassed tomorrow, market is staying in the upper end of its range going into the clsoe
16:00 LJ: Click Here for Next Chart
16:01 Tsam: LJ - u mean to short this rally back or to have bought the 1.272 and carry over?
16:01 LJ: Click Here for Next Chart
16:01 @Leslie: would have bought the 1.27
16:01 @Leslie: because of the momentum up made today
16:02 @Leslie: made the correction, 5.75 pts, harmonic retracement into good support area
16:02 @Leslie: if it got down to the 1554 area that also is a good buy area
16:03 Tsam: ok, ty
16:03 LJ: Click Here for Next Chart
16:03 @Leslie: no sells on a trend day up
16:03 @Leslie: unless you had some other type of market conditions present which we do not today
16:04 @Leslie: if I see the 1554 in globex, (meaning if I am awake) will buy that
16:13 @Leslie: we will look at the support areas for tomorrow and should get a sell area if makes a new high off the open in the first 30-60 minutes
16:13 @Leslie: if you are not familiar with trend days and how they trade, take some time to study today, this was really classic trend day
16:13 @Leslie: there is some trend day information on websigte
16:14 @Leslie: the new book that is almost out, being shipped out of wiley warehouse 10/19 has a full chapter on trading trend days
16:14 @Leslie: you can pre order that at amazon.com
16:14 @Leslie: Trade What You See - How to Profit From Pattern Recognition
16:15 @Leslie: will see everyone tomorrow!
16:24 Elly: thanks a bunch!