MovingAvg (28)
140
130
120
110
10097.75
90
80
70
60
0
-7500
-15000-17443.56
-23240.49
-30000
-37500
Dec-03
Jan-04
Feb-04
Mar-04
Apr-04
May-04
Jun-04
Jul-04
Aug-04
Sep-04
Oct-04
Nov-04
Dec-04
Jan-05
Feb-05
Mar-05
Apr-05
May-05
Jun-05
Jul-05
Aug-05
Sep-05
Oct-05
Nov-05
FIGURE 17.6 Another example of dual moving average COT as a timing trigger.Source: Courtesy of www.GenesisFT.com.
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CL-055:  Crude Oil NY (Pit) Cont 1st (Weekly bars)
www.GenesisFT.com
9/2/05 07:06 = 69.70 (+3.57)
Buy trigger
Sell trigger
NO sell trigger
MovingAvg (9) MovingAvg (28)
Sell trigger
Buy trigger
MovingAvg (28) WilliamsAccumDist
NO sell trigger
75
69.70
65
60
55
50
45
40
35
30
25
25000
-1718.63-9438.35
-25000
-50000
-75000
83.327570.50
50
25
Apr-03
May-03
Jun-03
Jul-03
Aug-03
Sep-03
Oct-03
Nov-03
Dec-03
Jan-04
Feb-04
Mar-04
Apr-04
Jun-04
Jul-04
Sep-04
Oct-04
Nov-04
Dec-04
Jan-05
Feb-05
Mar-05
Apr-05
Jun-05
Jul-05
Sep-05
Oct-05
Nov-05
FIGURE 17.7 Combining the dual moving average of COT with the ADMA as atiming trigger.Source: Courtesy of www.GenesisFT.com.
LESSON 17 QUIZ
Instructions: Follow the instructions carefully.
For items 1 through 3, mark the COT buy and sell signals as taught in
this lesson.
1.
SB-055:  Sugar #11 Cont 1st (Weekly bars)
www.GenesisFT.com08/14/1998 = 8.54 (-0.40)
12.5
12
11.5
11
10.5
10
9.5
9
8.54
8
7.5
22869.59
0
-25000
-50000
-75000
MovingAvg (9) MovingAvg (19)
Sep-96
Oct-96
Nov-96
Dec-96
Jan-97
Feb-97
Mar-97
Apr-97
May-97
Jun-97
Jul-97
Aug-97
Sep-97
Oct-97
Nov-97
Dec-97
Jan-98
Feb-98
Mar-98
Apr-98
May-98
Jun-98
Jul-98
Aug-98
Source: Courtesy of www.GenesisFT.com.
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2.
LH-055:  Lean Hogs (Pit) Cont 1st (Weekly bars)
www.GenesisFT.com01/26/2001 = 55.625 (-1.125)
MovingAvg (9) MovingAvg (19)
80
75
70
65
60
55.625
50
45
40
35
30
2510000
50001663.14-152.11
-5000
-10000
-15000
Sep-98
Oct-98
Nov-98
Dec-98
Jan-99
Feb-99
Mar-99
Apr-99
May-99
Jun-99
Jul-99
Aug-99
Sep-99
Oct-99
Nov-99
Dec-99
Jan-00
Feb-00
Mar-00
Apr-00
May-00
Jun-00
Jul-00
Aug-00
Sep-00
Oct-00
Nov-00
Dec-00
Jan-01
Source: Courtesy of www.GenesisFT.com.
3.
PL-055:  Platinum (Pit) Cont 1st (Weekly bars)
www.GenesisFT.com9/2/05 08:03 = 902.5 (+4.7)
950
925
902.5900
875
850
825
800
775
-1000
-2000
-3000
-4000
-5000
-5905.65-6501.26
MovingAvg (9) MovingAvg (19)
May-04
Jun-04
Jul-04
Aug-04
Sep-04
Oct-04
Nov-04
Dec-04
Jan-05
Feb-05
Mar-05
Apr-05
May-05
Jun-05
Jul-05
Aug-05
Sep-05
Oct-05
Nov-05
Source: Courtesy of www.GenesisFT.com.
For items 4 through 6, mark the triggers as described in this lesson.
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4.
30 DAYS TO MARKET MASTERY
SB-055:  Sugar #11 Cont 1st (Weekly bars)
MovingAvg (L,8) MovingAvg (H,10)
www.GenesisFT.com08/27/2004 = 7.66 (-0.07)
MovingAvg (9) MovingAvg (19)
Feb-03
Mar-03
Apr-03
May-03
Jun-03
Jul-03
Aug-03
Sep-03
Oct-03
Nov-03
Dec-03
Jan-04
Feb-04
Mar-04
Apr-04
May-04
Jun-04
Jul-04
Aug-04
Source: Courtesy of www.GenesisFT.com.
5.
S-055:  Soybeane CBT (Pit) Cont 1st (Weekly bars)
www.GenesisFT.com∧4)
4 (+18
10/25/1996 = 700
∧
9
8.88.6
8.48.28.1287.827.66
7.4
7.276.8
6.6
6.46.2
6
5.8
5.6
5.4
5.2
25000
0
-25000
-50000
-78727.63
-100000
850∧0
800∧0
750∧0
700∧4
650∧0
600∧0
550∧0
Jun-94
Jul-94
Aug-94
Sep-94
Oct-94
Nov-94
Dec-94
Jan-95
Feb-95
Mar-95
Apr-95
May-95
Jun-95
Jul-95
Aug-95
Sep-95
Oct-95
Nov-95
Dec-95
Jan-96
Feb-96
Mar-96
Apr-96
May-96
Jun-96
Jul-96
Aug-96
Sep-96
Oct-96
Source: Courtesy of www.GenesisFT.com.
MovingAvg(28) Williams AccumDist
0-14720
-50000
1000
891.75805750
500
COT Commercials
50000
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6.
PA-055:  Platinum (Pit) Cont 1st (Weekly bars)
www.GenesisFT.com04/22/2005 = 201.50 (+1.95)
MovingAvg (9) MovingAvg (19)
MovingAvg (9) Williams AccumDist
Dec-02
Jan-03
Feb-03
Mar-03
Apr-03
May-03
Jun-03
Jul-03
Aug-03
Sep-03
Oct-03
Nov-03
Dec-03
Jan-04
Feb-04
Mar-04
Apr-04
May-04
Jun-04
Jul-04
Aug-04
Sep-04
Oct-04
Nov-04
Dec-04 Jan-05
Feb-05
Mar-05
Apr-05
Source: Courtesy of www.GenesisFT.com.
350
325
300
275
250
225
201.50
175
150
0
-2500
-5000
-7346.94
375
300
225177.72150
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L E S S O N 18, D A Y S 20–21
The Advanced30-MinuteBreakout forS&P and E-MiniTrading
T he popularity of day trading in stocks and futures has been a blessing
for many traders, but a curse to most. I say this because day tradingis a difﬁcult road to take as a means of making proﬁts in stocks andfutures. Previously in this course, I taught you the gap trade as a possibleday-trading method.
This method requires very little attention. Most day-trading methods,however, require considerable attention. Although I advise you that daytrading is both time consuming as well as difﬁcult, there are ways in which toharness the proﬁt potential of day trading. The 30-minute breakout methodtaught in this lesson will help you get the edge on day trading, but it willrequire the following:
(cid:2)(cid:2)(cid:2)
(cid:2)(cid:2)(cid:2)(cid:2)
Maximum discipline and attention to rules.Persistence.At least $50,000 in starting capital for trading the full-sized S&P contract(less for E-mini S&P and other markets).The ability to accept at least seven consecutive losing trades.The ability to sit at the computer all day.The discipline to ride proﬁts until the end of the trading day.The eventual ability to trade multiple positions.
THE CONCEPT AND SETUP
The 30-minute breakout method (30MBO) uses the price high and pricelow of the ﬁrst 30 minutes of each trading session (day session only) as the
151
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Range ofthe first30minutesof thedaysession
30-minute high
30-minute low
FIGURE 18.1 The 30MBO setup pattern showing the high and low of the ﬁrst30-minute price bar.
setup. The markets that are currently worth considering as appropriate forthe 30MBO are S&P, E-mini S&P, and in stocks SPY, DIA, and QQQ.
Finding the setup is very simple. All you have to do is to make note ofthe high and low price for the ﬁrst 30 minutes of the trading session; thiscan only be determined after the ﬁrst half-hour is over. Figure 18.1 showsan example of this.
A buy trigger occurs when and if any subsequent 30-minute price barends above the high of the ﬁrst 30-minute price bar. A sell trigger occurswhen any subsequent 30-minute price bar ends below the low of the ﬁrst30-minute price bar. (Note my emphasis on ends.)
A trigger can only occur at the end of a bar, not during a bar. Figures
18.2 and 18.3 show two examples.
A trigger can occur at the end of any 30-minute bar up to, but no later
than, the last hour of trading.
High = 1140.10
Low = 1136.40
Sell trigger on 30-minute"close" below low of 1st30-minute bar.
FIGURE 18.2 30MBO sell trigger example.
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Buy signal on "close" above 30-min. high
High = 1140.10
Low = 1136.40
FIGURE 18.3 30MBO buy trigger example.
FOLLOW-THROUGH FOR THE 30MBO
Follow-through for the 30MBO is very simple, but you must be consistentand highly disciplined in order to employ the follow-through method prof-itably. Here are the rules:
(cid:2)
(cid:2)
(cid:2)
(cid:2)
(cid:2)(cid:2)
(cid:2)
(cid:2)(cid:2)(cid:2)
As soon as a trade has triggered, your stop-loss becomes the oppositeside of the trade. In other words, if a buy is triggered ﬁrst, then the stopis a 30-minute ending price below the low of the ﬁrst 30-minute endingbar and vice versa for a short.When a trade is triggered, the ﬁrst proﬁt target is the range (high–low)of the ﬁrst 30-minute bar.If you have multiple contracts, then take proﬁt on part of your positionat the ﬁrst proﬁt target and place a stop at breakeven.If and when the trade achieves twice the range of the ﬁrst 30 minutesplace a stop at the ﬁrst proﬁt target. If you have multiple positions, takeproﬁt on another portion of your position and place a stop at the ﬁrstproﬁt target.Exit MOC (market on close) on all positions not stopped out.If you get a buy ﬁrst and are stopped out, then reverse to a sell and viceversa.Only take one reverse trade per day. In other words, if the second tradeloses money then there are no additional trades for the day.Always exit at the end of the day.Data used are for the day session only.All entry orders are at the market.
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30 DAYS TO MARKET MASTERY
This method can be very risky—but it can also produce some very largeproﬁts. The best time to begin using this method is after it has had 3–5losses in a row.
EXAMPLES OF 30MBO TRADES
Figures 18.4 and 18.5 show examples of 30MBO trades from start toﬁnish.
REVIEW
This lesson taught you the 30MOB method for day trading. The rules are clearand concise. Practice and the ability to ride large swings both in your favorand against you are of paramount importance if you want to be successfulwith this method.
Note that this lesson’s quiz requires more attention than some of theprevious quizzes due to the degree of judgment required when interpretingcharts. Take your time.
Sell trigger
Profit target hit
FIGURE 18.4 An example of the 30MBO setup, trigger, and follow-through.
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Second target reached.
First target reached.
Buy trigger⎯
reverse:
too long.
Exit rest ofpositionMOC.
Sell trigger
FIGURE 18.5 Another example of the 30MBO from trigger to exit.
LESSON 18 QUIZ
Instructions: Follow the instructions carefully.
Mark all the 30MBO signals as well as their follow-through. If you do
not have the actual prices, use your best estimates.
1.
SP-200509:  S&P 500 Index (Pit) Sep 2005 (30 minute bars)
www.GenesisFT.com8/26/05 13:15 = 1205.5 (-8.0)
1216
1215
1214
1213
1212
1211
1210
1209
1208
1207
12061205.51205
1204
1203
1202
Source: Courtesy of www.GenesisFT.com.
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2.
30 DAYS TO MARKET MASTERY
S P - 2 0 0 5 0 9 :
  S & P   5 0 0  
I n d e x   ( P i
t )   S e p   2 0 0 5   ( 3 0   m i n u t e   b a r s )
www.GenesisFT.com8 / 2 2 / 0 5   1 3 : 1 5   =   1 2 2 3 . 9   ( - 0 . 1 )
1 2 3 1
1 2 3 0
1 2 2 9
1 2 2 8
1 2 2 7
1 2 2 6
1 2 2 5
1 2 2 3 . 9
1 2 2 3
1 2 2 2
1 2 2 1
1 2 2 0
1 2 1 9
1 2 1 8
1 2 2 9 . 5
1 2 2 9
1 2 2 8 . 5
1 2 2 8
1 2 2 7 . 5
1 2 2 7
1 2 2 6 . 5
1 2 2 6
1 2 2 5 . 5
1 2 2 5
1 2 2 4 . 5
1 2 2 4
1 2 2 3 . 5
1 2 2 3
1 2 2 2 . 5
1 2 2 2
1 2 2 1 . 5
1 2 2 1
1 2 2 0 . 5
1 2 2 0
1 2 1 9 . 5
Source: Courtesy of www.GenesisFT.com.
3.
S P - 2 0 0 5 0 9 :
  S & P   5 0 0  
I n d e x   ( P i
t )   S e p   2 0 0 5   ( 3 0   m i n u t e   b a r s )
www.GenesisFT.com8 / 1 7 / 0 5   1 3 : 1 5   =   1 2 2 1 . 5   ( + 0 . 3 )
Source: Courtesy of www.GenesisFT.com.
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157
4.
E U - 0 5 5 :
  E u r o   F X   ( P i
t )   C o n t
  1 s t
  ( 3 0   m i n u t e   b a r s )
www.GenesisFT.com8 / 4 / 0 5   1 2 : 0 0   =   1 . 2 4 0 1   ( + 0 . 0 0 4 2 )
Source: Courtesy of www.GenesisFT.com.
5.
S P - 2 0 0 5 0 9 :
  S & P   5 0 0  
I n d e x   ( P i
t )   S e p   2 0 0 5   ( 3 0   m i n u t e   b a r s )
www.GenesisFT.com8 / 1 7 / 0 5   0 7 : 0 0   =   1 2 2 1 . 7   ( + 0 . 5 )
Source: Courtesy of www.GenesisFT.com.
0 8 / 1 7 / 0 5
1 . 2 4 1 5
1 . 2 4 1
1 . 2 4 0 5
1 . 2 4 0 11 . 2 4
1 . 2 3 9 5
1 . 2 3 9
1 . 2 3 8 5
1 . 2 3 8
1 . 2 3 7 5
1 . 2 3 7
1 . 2 3 6 5
1 . 2 3 6
1 . 2 3 5 5
1 . 2 3 5
1 . 2 3 4 5
1 . 2 3 4
1 . 2 3 3 5
1 . 2 3 3
1 2 3 4
1 2 3 3
1 2 3 2
1 2 3 1
1 2 3 0
1 2 2 9
1 2 2 8
1 2 2 7
1 2 2 6
1 2 2 5
1 2 2 4
1 2 2 3
1 2 2 21 2 2 1 . 7
1 2 2 1
1 2 2 0
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6.
30 DAYS TO MARKET MASTERY
S P - 2 0 0 5 0 9 :
  S & P   5 0 0  
I n d e x   ( P i
t )   S e p   2 0 0 5   ( D a i
l y   b a r s )
www.GenesisFT.com0 7 / 2 1 / 2 0 0 5   =   1 2 3 0 . 0   ( - 6 . 5 )
1 2 4 21 2 4 0
1 2 3 81 2 3 6
1 2 3 41 2 3 2
1 2 3 0 . 01 2 2 81 2 2 6
1 2 2 41 2 2 2
1 2 2 01 2 1 8
1 2 1 61 2 1 41 2 1 21 2 1 01 2 0 8
1 2 0 6
1 2 0 41 2 0 21 2 0 0
1 1 9 81 1 9 61 1 9 41 1 9 2
1 1 9 01 1 8 81 1 8 6
0 7 / 0 8 / 0 5
Source: Courtesy of www.GenesisFT.com.
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L E S S O N 19, D A Y S 22–24
How to StructureYour TradingPortfolio forMaximum andConsistent Gains
H ere is the bottom line:
No matter how good your trading and timing methods are, you willnot make money unless you can incorporate certain vital featuresinto your trading.
In my 35 years of trading, investing, and market analysis I have observedthat a vast majority of traders have no plan, no direction, and no structure intheir trading. They trade by the seat of their pants hoping to make a proﬁt.In point of fact, they limit their odds of doing so due to their lack of effectivetools and procedures.
This lesson gives you the tools to help organize and implement yourtrades effectively and consistently. My suggestions here are not necessarilyin their order of importance.
KEEP A TRADE LOG
Proper organization is a prerequisite to success. Many traders lose moneybecause they are not organized. They are either unaware of trading signalswhen they occur or they are not prepared. The ﬁrst thing you must do—andwithout fail—is to keep a record of every order that you enter. If you useonline order entry, then the record of your orders will be there automatically.
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30 DAYS TO MARKET MASTERY
However, if you do not, then you must use either a computerized trade(or order) log or a written one. The trade log should contain all relevantinformation for each order you enter.
Figure 19.1 gives an example of what your trade log should look like.
You can easily set one up in any of the popular spreadsheet programs.
Here is how to use the trade log:
1. Assign each trade a number. The ﬁrst trade of the day would be #1; thesecond trade of the day would be #2, and so on. Enter this number inthe ﬁrst column.
2. Indicate whether the trade is a Buy (B) or a Sell (S).
3. Indicate the type or order. For example, note if the order is at the market,MIT, limit, stop limit, day order, or market order. Use an abbreviationmethod such as M for market, D for day order, O for open order, L forlimit, MI for MIT, and SL for stop limit.
4. Enter the market and contract month. In some cases you may also wantto enter the exact time the order was placed and the ticket number yourbroker gives you. Do this if you are having difﬁculty getting good ortimely ﬁlls from your broker.
5. Once the order has been ﬁlled, enter the price in the Fill or CXL column.If the trade is not ﬁlled and you cancel it, then enter CXL in this column.
6. You should be using a trading system or method. If so, then enter anabbreviation for the name of the system or signal in the Signal columnso that you can keep track of your system or method performance andexit strategy.
7. Enter any relevant comments in the Comment columns. These notesshould be as speciﬁc as possible so as to help you learn from yoursuccesses and failures.
8. Leave a blank line or lines after each trade so that you can ﬁll it inwhen you exit the trade. The number of lines that you leave blank willbe a function of the position size and system you are using. As youmay recall, some of my methods exit positions one-third at a time. Myillustration below will clarify if you are uncertain as to what I mean.
9. Once a trade has been closed out, enter the exit price and outcome in
the indicated columns.
10. Use a new sheet for each day if you are keeping a paper trail.
11. It is best to use a computerized spreadsheet that will automatically give
you a sum total of your proﬁts and losses.
12. Compare your records with your brokerage statements to make sure
that they are consistent.
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