What Might Have Been

by | Jun 12, 2020 | Editorial | 0 comments

Taking losses in trading is just part of the game.  

But they don’t have to be part of your daily routine.

In fact, if you follow the pre-market action…

You’ll have a competitive advantage over most traders…

More importantly, it can lead to bigger and better profits.

It’s no secret, I have absolutely crushed it in this volatility.

Now, I want to show you how I’m finding an edge…

During these uncertain times.

 

Daily Deposits

 

The strategy that is used at Daily Deposits is focused on intraday momentum by anticipating the markets based off of a custom set of pre market analytics.  

And why even bother holding stocks overnight when you are able to crush the markets only trading intraday!

Just by focusing on a few key momentum indicators and the pre market trading session you have the opportunity to make triple digit returns week after week.  

So let’s take a look at exactly how I got my trades off to capture huge profits over these last few days.

 

Pre Market Analysis

 

The first step in finding trades is searching the pre market for clues as to what the market may do after the bell rings.

Daily Deposits is based around a set of indicators that have been put to the test in one of the hardest to trade markets in history.  

And the momentum trading strategy that I have developed and actively trade has been crushing the markets.

The pre market is broken into 3 key parts:

  1. The global overnight outlook
  2. Sectors for the US Markets
  3. Daily chart on SPY with Technical Analysis reviews

 

Source: Finviz.com

 

And to narrow your search, it’s best to focus on only a few time frames… such as the 5, 10 and 15 minute charts and apply the 3 key momentum indicators.

3 key momentum indicators:

  1. Price action and volume
  2. Moving averages
  3. Volatility analysis

Let’s take a look at how to correctly use these three pre market momentum indicators to determine the direction of the markets before each trading day.

 

The Pre Market Momentum Indicators

 

Momentum is all about catching the right stock, at the right time, and determining the right direction it’s going to take.

And it can stop and change direction on a dime without much warning.

By using these momentum indicators you are able to pick swings and breakouts easily.

So let’s take a look at each one of these indicators and how to use them to determine the direction of the markets.

How it works:

  • Understand the major trend based on the highest timeframe first
  • Use lower time frames for immediate trend analysis
  • Confirm momentum using moving averages, TTM and volume analysis

Now let’s take a look at how the charts break down and give us the trade signal for the Trade of the Day.

 

Pre Market Chart Review

 

Here is a chart of the SPY in the pre market session.

 

Source: Thinkorswim

 

By looking at the 5 minute chart before the market opens you are able to learn a lot about how the traders are thinking.  

This analysis can give you a clear picture of what direction to trade the markets in the day ahead.

Here are the key factors that we saw in the SPY’s trade for today.

  • The short term trend is bearish
  • The long term trend is bearis
  • The market sold off right at prior support price, couldn’t hold this level
  • TTM_Squeeeze was green all morning, showing significant momentum to the downside

So before placing any trades it is always best to analyze what these indicators are telling you about the stock.

Note:  It’s always a good idea to lay out where you believe the nearest stop levels are to place trades or stop prices.  Then once the markets are open you can use these information to help guide your trades.

 

Wrapping Up

 

The strategy that is used at Daily Deposits to find the Trade of Day is focused on intraday momentum by anticipating the markets based off of a custom set of pre market analytics.  

And why even bother holding stocks overnight when you are able to crush the markets only trading intraday!

Just by focusing on a few key indicators and the pre market trading session you have the opportunity to make triple digit returns week after week.  

Click here to join Daily Deposits!

 

0 Comments

Submit a Comment

Your email address will not be published. Required fields are marked *