THE MARKET MECHANIC BROUGHT TO YOU BY ODYSSEY TRADING GROUP FOR 08/01/ 2012
Welcome to the Market Mechanic daily blog
TODAYS ACTION: All eyes on the Fed. Today’s trade limited as the market awaits the FMOC rate decision released at 1:15 PM. Trade is so limited that our software and system only generates 3 buy signals before the 1:15 PM announcement. The FMOC announcement does not meet traders’ expectations and the market sells off the system does generate a profitable sell signal. The market then trades sideways with an upward bias for the remainder of the day.
9:40 AM buy signal emini S&P price 1378.50 The set up, with the 5, 10 and 20 DTI’s with positive readings, the trigger; on the 10 minute chart with the cross and close of the 10 minute DMI from negative to positive a buy signal is generated. Subsequent high 1380.00.
10:30 AM buy signal emini S&P price 1377.50 The set up; with above 50 readings on the RSI and the TI agg on the 20 minute chart and a positive reading on the 10 minute DTI, the trigger; with the cross of the DMI on the 5 minute chart, from negative to positive a buy signal is generated. Subsequent high 1380.00
11:10 AM buy signal emini S&P price 1378.50 The set up, on the 20 minute chart if 2 out of 3 of the following: the 20 minute TIndex, the 40 minute TIndex and or the 40 minute TI agg have positive readings and the 20 minute TI agg is above its 50 line; the trigger: the 20 minute DMI crosses from negative to positive, a buy signal is generated. Subsequent high 1380.00.
1:50 PM sell signal emini S&P price 1372.00 . The set up; on the 10 minute chart the DTI and the TI agg both have negative readings, the trigger; when the 5 minute MACD, 5 minute DTI, 5 minute RSI and the 5 minute Chaikin Oscillator all align negative, a sell signal is issued. Subsequent low 1370.50.
AFTER THE CLOSE: The post FOMC market sell left its mark on our indicators. The TIndexes from the 5 minute through the 30 minute finished the day in negative territory. The DTI’s from the 5 minute through 60 minute finished the day negative. The indicators are not that significant as we wait for the European Central Bank announcement and Friday’s unemployment numbers.
On a personal note. The family and I are traveling to Elgin Air Force Base, Fl to visit our son who is being trained for explosive ordinance disposal, yes that is the Hurt Locker people. He completed the first part of his training, a 10 week course at FT. Lee VA. and was recently posted to Elgin AFB for 34 weeks of more training. So my attention will not fully be on the market for the next week, but I will be checking in and hope to do the market recap in a timely fashion.
ABOUT THE MARKET MECHANIC;
The Market Mechanic has developed 3 proprietary indexes and oscillators: the Trend Index Aggressive (TI agg), the Delta Trend Index (DTI) and the Trend Index (TIndex). These 3 proprietary indicators combined with the Directional Movement Index (DMI), the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) give us several distinct, high probability set ups that are used to day trade the emini S&P market. These indexes and oscillators are applied on time frames from 5 minutes to 60 minutes (5, 10, 15, 20, 30, 45 and 60) and these set ups are traded on all time frames. The final product of the combination of these proprietary and non proprietary oscillators and indexes is a mechanical system and methodology for identifying entry points into the market that completely sidelines emotion and allows its user to concentrate on the money management part of the trading equation.
The philosophy of the Market Mechanic is not to predict the market but to anticipate likely market scenarios that the market will produce on a daily basis and the best way to exploit these opportunities. These set ups are designed to profitably and consistently exploit these market scenarios.
Markets are opportunity generating machines; our software and methodology strive to take advantage of these opportunities as they arise and provide its users a consistent and reliable profit making trading set ups.