Art of the Trade And New Telegram
And a bit of science
Hello traders,
Wishing you all a merry christmas to those who celebrate.
Note: Weekly plan should be out by Tuesday RTH open.
Today we will review a couple trades from Friday, the rationale and the execution.
At the entry for the puts I went through my checklist for SPX options (For ES trades I have a more exhaustive checklist due to having only 2.75-3.25pt stops).
Is the price below Weekly Bull #2 (implying a rangebound week instead of a trending one thereby avoiding a counter-trend trade( we do those too, but not very often)
Price is below Daily Bull #2 after attempting a breakout. This is important in a discretionary trading environment in order to eliminate trades with lower probabilities.
A quick look at the orderflow at 10:48am ET ( I was on the phone so I used the bookmap live stream)
A small prayer to the Gods and then we enter the trade. We have a natural stop right behind the 4820.75 liquidity.
And that is about it. Most of the heavy lifting is done by the algorithmic levels we generate and then we scale our positions according to our profit targets and R(Risk/Reward Ratio).
In about 10 minutes we got our first targets hit and then we let the runners ride with breakeven stop.
Conversely on the second trade, we had our Daily Bear level at 4782 and we saw many buy iceberg orders and market buy orders that allowed us to risk some of the profits on OTM SPX calls. This was a contrarian trade but if you have had a pair of eyes the past year you definitely know that punting on the bullish side has +EV.
CHRISTMAS SALE:
In the spirit of Holidays and demand from free readers about lowered cost of the substack, I have lowered the price until 1/21/2024 (primarily due to my recently lowered compute costs that I would love to pass on to the readers) .
Side note: I will always try to push out as much free content as possible on X and Substack as I have deep seated validation issues as I love writing and helping everyone.
New Telegram: