Webinar

Shortly before Yellen was scheduled to blather, we stalked some subscriber favorites, including NFLX, the E-Mini S&Ps, Comex Gold and Nymex crude oil. There are some subtle points covered during this session, although paradoxically, due to the Fed ‘news’ that was about to come, the stock market was shortly about to launch into its wonted, wild spasms. Even so, you’ll see that Hidden Pivot Analysis still managed to nail the over/under bet pretty well.

We stalked a possible trade in TLT toward the end of this session, looking for an impulse leg subtle enough to get us aboard a mature rally with as little risk as possible. The key to the trade was as fine a specimen of the look-to-the-left-peak as we have come across, created so long ago that few other traders or technicians would have been paying much attention to it. For a finely nuanced refresher on impulse legs and the lengths to which we will go to qualify them as such, skip to the final 20 minutes of the recording and enjoy the show

We came to the session with some bullish ‘mechanical’ trades touted in Crude and Gold, but there were some appealing opportunities to cut the entry risk considerably using ‘camouflage’. Although the futures went nowhere and our attempt produced a scratched trade, the thought process on display in this recording is instructive. We also had second thoughts about shorting a minor target in JNK, the ETF for junk bonds. To see why, and to see the aggressive solution we came up with, fast forward to around the middle of the session.

Toward the end of this session, we got immersed in an option trade, trying to leverage a rally target in DIA. Rather than positioning ourselves to buy puts when DIA reached our objective, we projected a ‘fair’ option price by using an ABC pattern for the option itself – in this case a slightly out-of-the-money weekly put with just a day left. The thought process is a study in Hidden Pivot logic – as detailed a study as you will find in the Rick’s Picks recorded archive of tradable ideas.

We spent the hour scavenging for crumbs on a day when stocks were in a weak short-squeeze, continuing a trend begun a week earlier. The obvious play, at least in the relentlessly buoyant E-Mini S&Ps, was a ‘mechanical’ buy on any pullback to the green line. To further reduce entry risk, we considered mainly ‘counterintuitive’ set-ups. The result was not pretty, even if the trade in question went on to produce a small profit for those with infinite patience.

It was a slow day, but we still managed to ferret out two winning trades in the space of an hour. Pay close attention to the closely reasoned ‘camouflage’ entry in the E-Mini S&&Ps, since it did not go our way initially. We stayed on board anyway simply because that is what disciplined trading demands of us. The successful trader is one who understands that the inevitable loss now and then is integral to the process of winning. As such, with the percentages working for us over time, we should never have to second-guess ourselves. There is also a beautiful ‘counterintuitve’ opportunity on display here, although we were too late to jump on it. Just a single tick’s difference between points A and C turned a diabolically tricky entry challenge into an easy winner.

Anyone who has attended more than a few tutorial sessions will find in this lesson one of the most closely reasoned trades on record. We stalked April Gold with the intention of forcing an entry come hell or high water. In this case, the result exceeded our expectations. Most of the action took place on the one-minute chart, where there will nearly always be opportunities to turn a quick, small profit. What is most satisfying about these trades is that there is little stress associated with them. We risked just three ticks ($30) getting aboard, and although this sum was briefly in jeopardy – literally for the blink of any eye – the payoff made it worth the 60-second wait for results. The trade also gave us a chance to stay long for a possible ride much higher with no skin in the game. That’s what ‘camouflage’ trading is all about.

We looked at several ‘mechanical’ set-ups during this session, including one in T-Bond futures that was based on a bullish event that occurred two weeks ago on the weekly chart. There were also some day-trade possibilities in gold and the E-Mini S&Ps, with a trigger in the latter that came from the 1-minute bars. What happens when a ‘perfect’ set-up fails to produce a profit? Check out this recording for the answer.

If you can make it in New York New York, as the song goes, you can make it anywhere. During this session, we spent time in the Times Square of trading environments – i.e., the six-minute bar chart of Priceline, a $1300 stock. The leaps, feints, flutters, and wild oscillations of this giant-killer make it an ideal candidate to test our Hidden Pivot chops, particularly the camouflage technique. If you can make money day-trading PCLN, then switching to, say, NFLX or even Google will seem like a walk in the park. For the record, the trade set-up that engaged us toward the end of the session – a counterintuitive entry on 400 shares with $240 of initial risk -- went on to produce a profit of as much as $1600 within 45 minutes.