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E-Mini S&P 60-min chart Price Profit 01-Jul-02 Open 1 996 02-Jul-02 Sell 2 964 -32.5 03-Jul-02 Buy 2 955 8.75 08-Jul-02 Sell 2 974 19.25 17-Jul-02 Buy 2 921 53.5 17-Jul-02 Sell 2 897 -23.75 24-Jul-02 Buy 2 815 81.75 31-Jul-02 Close 1 908 92.75 TOTAL: 14 199.75 $9,988 Average profit per trade $1,427 A very profitable month, but the High/Low strategy on 60-minute bars does not have to maintain this level of profitability for it to be a valuable filter. 70 Chapter 10: Reading the Current Price As a floor trader I learned to read the current price. I did not have access to charts when I was in the pit, so I learned to interpret the price action. At first it seems pretty chaotic and confusing, yet if you spend time watching the price, without reference to a chart, you will start to make observations that will help you to start anticipating the ebb and flow of the market. Our ability to read the current price develops through experience, experience of observing and questioning the price action. We need to bring an enquiring and open mind to observing the market, faithful that there are distinctions that we can make that will lead us to profitable trading opportunities. I remember once watching one of the biggest FTSE locals pick his spot to buy. He stood in the market confidently bidding for a 100 lots. He maintained his bid for a few minutes, buying a few hundred contracts; then I watched as the market started to move away from his bid, slowly rising. It seemed amazing to me that he could so confidently and so accurately pick this bottom (this low was the lowest low for some time and wasn't just a momentary response to his buying). |
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