Trading levels and reports for Dec 4th + educational article
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Dear Trader,
Scroll below levels and reports for today's trading 101:
Trading Emini Futures vs Stocks by Mike Reed of http://www.TradeStalker.com
LEVELS:
| Contract (Dec.. 2006) | SP500 (big & Mini) | Nasdaq100 (big & Mini) | Dow Jones (big & Mini) | Mini Russell |
| Resistance 3 | 1423.37 | 1830.00 | 12444 | 805.33 |
| Resistance 2 | 1413.83 | 1813.00 | 12355 | 797.17 |
| Resistance 1 | 1406.77 | 1796.50 | 12285 | 790.08 |
| Pivot | 1397.23 | 1779.50 | 12196 | 781.92 |
| Support 1 | 1390.17 | 1763.00 | 12126 | 774.83 |
| Support 2 | 1380.63 | 1746.00 | 12037 | 766.67 |
| Support 3 | 1373.57 | 1729.50 | 11967 | 759.58 |
| Contract | Feb. Gold | Dec. Euro | Jan. Crude Oil | March Bonds |
| Resistance 3 | 660.23 | 1.3521 | 65.05 | 115 27/32 |
| Resistance 2 | 657.87 | 1.3440 | 64.28 | 115 13/32 |
| Resistance 1 | 654.23 | 1.3393 | 63.85 | 115 |
| Pivot | 651.87 | 1.3312 | 63.08 | 114 18/32 |
| Support 1 | 648.23 | 1.3265 | 62.65 | 114 5/32 |
| Support 2 | 645.87 | 1.3184 | 61.88 | 113 23/32 |
| Support 3 | 642.23 | 1.3137 | 61.45 | 113 10/32 |
REPORTS (EST): Provided by www.tradethenews.com audio news and interactive research directly from the pits
Monday, Dec 4th, 2006
Economic
10:00am Oct Pending Home Sales (last –1.1%)
Events
LSTR, NVLS mid-Q update. CTV analyst meeting. Fed's Moskow interviewed on CNBC.com at 9:00am. Bear Stearns Real Estate conference in NYC through 12/5. Credit Suisse Media/Telecom conference in NYC through 12/7. UBS Global Media conference in NYC through 12/7. Trades Ex-dividend: SLB $0.125.
Earnings
Before the Open: IMKTA NRGY. After the Close: CMTL CNQR PLL.
Note all time are EST. ANY AND ALL TIMES AND DATES ARE SUBJECT TO CHANGE WITHOUT NOTICE. INFORMATION HAS BEEN TAKEN FROM SOURCES DEEMED TO BE RELIABLE, BUT NO ASSURANCES CAN BE MADE TO THE ACCURACY OF ANY OF THIS INFORMATION.
Trading 101:
Trading Emini Futures vs Stocks by Mike Reed of http://www.TradeStalker.com
There are reasons why a day trader would prefer Eminis over
day trading stocks, and vice versa. Here are a few major
considerations.
The edge…
Stock trading can take advantage of the small and variable
lag time between stocks and the futures. This can give a
day trader who is trading stocks an edge, especially if
he/she is a scalper. And, if you are trading a liquid stock
which is highly correlated to the Dow or S&P500, it’s
possible to latch on when a “buy program” hits the market.
lag time between stocks and the futures. This can give a
day trader who is trading stocks an edge, especially if
he/she is a scalper. And, if you are trading a liquid stock
which is highly correlated to the Dow or S&P500, it’s
possible to latch on when a “buy program” hits the market.
This variable lag, however, explains why the Eminis often
times give more accurate support and resistance levels than
stock market indices or individual stocks. Since the stock
index futures lead the stock market, they’re not constantly
lagging behind, playing catch up, or over-shooting a
leader’s path, as the stock market is. The Emini’s
movements are more pure, reflecting supply and demand
instantly and accurately.
times give more accurate support and resistance levels than
stock market indices or individual stocks. Since the stock
index futures lead the stock market, they’re not constantly
lagging behind, playing catch up, or over-shooting a
leader’s path, as the stock market is. The Emini’s
movements are more pure, reflecting supply and demand
instantly and accurately.
The leverage and size…
Trading stocks allows you to use less leverage and reduce
your trading size to a level that may be more comfortable
for some traders.
your trading size to a level that may be more comfortable
for some traders.
Trading one contract in the Emini’s carries a hefty bit of
leverage that some traders may not want. On the other hand,
many traders prefer the futures leverage.
leverage that some traders may not want. On the other hand,
many traders prefer the futures leverage.
The liquidity…
If you are trading stocks, you may have noticed that many
individual stocks are not very liquid, at least not liquid
enough for the kind of defensive day trading I do. To use
my crucial rule, “every trade starts out as a scalp until
proven otherwise,” you have to trade something that is
extremely liquid, or slippage will ruin you. However, if you
are interested in trading stocks, there are some stocks that
do have excellent liquidity.
individual stocks are not very liquid, at least not liquid
enough for the kind of defensive day trading I do. To use
my crucial rule, “every trade starts out as a scalp until
proven otherwise,” you have to trade something that is
extremely liquid, or slippage will ruin you. However, if you
are interested in trading stocks, there are some stocks that
do have excellent liquidity.
The Eminis are one of the most liquid markets in the world,
with very little slippage.
with very little slippage.
The professional competition…
The NYSE stocks trade in a pit with specialists taking
advantage of the spread, scalping with minimal costs per
trade, a huge advantage over the public. The playing field
is not level. Specialists are not in business to lose money.
(The Nasdaq stocks, however, trade electronically,
eliminating these problems.)
advantage of the spread, scalping with minimal costs per
trade, a huge advantage over the public. The playing field
is not level. Specialists are not in business to lose money.
(The Nasdaq stocks, however, trade electronically,
eliminating these problems.)
Emini’s are traded electronically without a pit and without
locals taking advantage of the spread. (The Maxi contracts
are still in the pit, but the Eminis appear to be leading
the Maxis now, so there doesn’t appear to be direct
competition between scalpers of the Eminis and the locals in
the Maxis pit.) It’s true that big Emini traders who own a
seat on the exchange and trade “size” have a cost advantage,
but by historic standards, their costs are not much lower
than the “retail” traders. Any Emini trader can now trade a
“round turn” (buy and sell combined) for $4.80 per contract.
And retail costs have been dropping. They’ll probably
continue to fall.
locals taking advantage of the spread. (The Maxi contracts
are still in the pit, but the Eminis appear to be leading
the Maxis now, so there doesn’t appear to be direct
competition between scalpers of the Eminis and the locals in
the Maxis pit.) It’s true that big Emini traders who own a
seat on the exchange and trade “size” have a cost advantage,
but by historic standards, their costs are not much lower
than the “retail” traders. Any Emini trader can now trade a
“round turn” (buy and sell combined) for $4.80 per contract.
And retail costs have been dropping. They’ll probably
continue to fall.
The ease and psychology of two-sided trading…
Stocks are a bit difficult to short due to the “up-tick”
rule (which means a stock has to move up one tick before you
can short it). And there is a view widely held by retail
traders that shorting a stock is not the most “wholesome”
thing a person can do. (But actually, short positions are
“squeezed” in uptrends so they provide additional “fuel” for
uptrends. After all, a price rally normally doesn’t stop
until most of the buyers have bought and most of the shorts
have been squeezed out. Take the shorts out of the equation
and rallies are not as sustainable.)
rule (which means a stock has to move up one tick before you
can short it). And there is a view widely held by retail
traders that shorting a stock is not the most “wholesome”
thing a person can do. (But actually, short positions are
“squeezed” in uptrends so they provide additional “fuel” for
uptrends. After all, a price rally normally doesn’t stop
until most of the buyers have bought and most of the shorts
have been squeezed out. Take the shorts out of the equation
and rallies are not as sustainable.)
Day trading the Eminis is not hindered by an up-tick rule.
Going short is as easy as going long. And as far as I know,
there’s no stigma attached to shorting the eminis. In fact,
most professional stock index futures traders I’ve met
prefer shorts over longs. Maybe it’s because the public is
more comfortable making money on uptrends.
Going short is as easy as going long. And as far as I know,
there’s no stigma attached to shorting the eminis. In fact,
most professional stock index futures traders I’ve met
prefer shorts over longs. Maybe it’s because the public is
more comfortable making money on uptrends.
Preparation to trade…
Trading stocks doesn’t necessarily involve stock
fundamentals. But stock fundamentals, including the stock’s
“story,” can help determine whether you want to favor longs
or shorts. For instance, if you’re trading the stock of a
company that has just announced a cure for cancer, you might
favor the long side. But you’ve got to dig and read
excellent sources to find good fundamental stock info. And
even if you’re not trading with stock fundamentals, you’ve
still got to search hundreds of stock charts for technical
setups and chart patterns. This can take hours per day.
fundamentals. But stock fundamentals, including the stock’s
“story,” can help determine whether you want to favor longs
or shorts. For instance, if you’re trading the stock of a
company that has just announced a cure for cancer, you might
favor the long side. But you’ve got to dig and read
excellent sources to find good fundamental stock info. And
even if you’re not trading with stock fundamentals, you’ve
still got to search hundreds of stock charts for technical
setups and chart patterns. This can take hours per day.
Day trading the eminis doesn’t necessarily involve anything
like stock fundamental analysis. I don’t even pay attention
to the content of important news releases, such as the Fed’s
decisions on interest rates. I just keep track of when the
important reports are scheduled, and I get out of their way
until after the news hits. When the news hits, there are
usually two false moves. Then a decent trend often emerges,
and I try to get on board. With no stock fundamentals to
consider, and only the same charts to analyze each night, I
save myself hundreds of hours of work each year.
like stock fundamental analysis. I don’t even pay attention
to the content of important news releases, such as the Fed’s
decisions on interest rates. I just keep track of when the
important reports are scheduled, and I get out of their way
until after the news hits. When the news hits, there are
usually two false moves. Then a decent trend often emerges,
and I try to get on board. With no stock fundamentals to
consider, and only the same charts to analyze each night, I
save myself hundreds of hours of work each year.
Taxes…
I’m not an expert on taxes, but one thing is for sure, it’s
much easer to prepare your own tax forms if you’re trading
the Eminis than if you are a taxpayer who is making a living
trading stocks or exchange traded funds (like the Spyders
and QQQQ’s). There may also be some dollar tax advantages.
Check with your tax adviser, of course.
much easer to prepare your own tax forms if you’re trading
the Eminis than if you are a taxpayer who is making a living
trading stocks or exchange traded funds (like the Spyders
and QQQQ’s). There may also be some dollar tax advantages.
Check with your tax adviser, of course.
Size of your trading account…
Trading stocks requires a $25,000 minimum in your account.
I guess the government stepped in to protect us from ourselves.
You can trade the Eminis with as little as $2,000 in your
trading account, which makes it possible for just about
anyone to day trade the Eminis.
trading account, which makes it possible for just about
anyone to day trade the Eminis.
Being an emini day trader myself, I may not be the most
unbiased source of information on this subject. But no
matter which way you decide to go, my services can be
extremely valuable to you whether you are day trading
stocks, or day trading the eminis.
unbiased source of information on this subject. But no
matter which way you decide to go, my services can be
extremely valuable to you whether you are day trading
stocks, or day trading the eminis.
I write a market newsletter each day, giving my "game plan"
for the next trading day. Take your trading a step higher
with a "Real-Time" subscription to my RBI Trader’s Updates.
My nightly reports help many professional day traders
anticipate the next day’s major and minor market moves,
giving them an edge they can find nowhere else.
******************************************************
Mike Reed is author of TradeStalker's RBI Trader's Updates.
He has been trading the Market for 24 years. His support and
resistance numbers have been published on the internet since
1996. Mike's nightly support and resistance zones are
specific and incredibly accurate. He offers an unlimited
free trial of his nightly TradeStalker RBI Trader's Updates.
http://www.TradeStalker.com Copyright 2006 Mike Reed
for the next trading day. Take your trading a step higher
with a "Real-Time" subscription to my RBI Trader’s Updates.
My nightly reports help many professional day traders
anticipate the next day’s major and minor market moves,
giving them an edge they can find nowhere else.
******************************************************
Mike Reed is author of TradeStalker's RBI Trader's Updates.
He has been trading the Market for 24 years. His support and
resistance numbers have been published on the internet since
1996. Mike's nightly support and resistance zones are
specific and incredibly accurate. He offers an unlimited
free trial of his nightly TradeStalker RBI Trader's Updates.
http://www.TradeStalker.com Copyright 2006 Mike Reed
Disclaimer:
The financial markets are risky. Investing is risky. Past
performance does not guarantee future performance. The
foregoing has been prepared solely for informational
purposes and is not a solicitation, or an offer to buy or
sell any security. Opinions are based on historical research
and data believed reliable, but there is no guarantee that
future results will be profitable.
The financial markets are risky. Investing is risky. Past
performance does not guarantee future performance. The
foregoing has been prepared solely for informational
purposes and is not a solicitation, or an offer to buy or
sell any security. Opinions are based on historical research
and data believed reliable, but there is no guarantee that
future results will be profitable.
We are not advocating trading futures. The prices and
contracts in the TradeStalker's RBI Updates specify a manner
in which you could trade. We occasionally mention the SP500
and Nasdaq futures markets because it is extremely liquid
and tends to lead the other markets. This is not an
endorsement or recommendation of the SP500 and Nasdaq
futures markets. The risk of loss in futures is substantial.
You can lose more than your original investment. We are not
Registered Investment Advisors or Commodity Trading
Advisors.
contracts in the TradeStalker's RBI Updates specify a manner
in which you could trade. We occasionally mention the SP500
and Nasdaq futures markets because it is extremely liquid
and tends to lead the other markets. This is not an
endorsement or recommendation of the SP500 and Nasdaq
futures markets. The risk of loss in futures is substantial.
You can lose more than your original investment. We are not
Registered Investment Advisors or Commodity Trading
Advisors.
This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts herein contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgment in trading!
Sincerely,
Ilan Levy-Mayer, M.B.A
Vice President
Cannon Trading Co Inc.
http://www.cannontrading.com
http://www.E-Futures.com
ilan@cannoncapital.com
Yahoo IM ilanlevy1970
310-859-9572
800-454-9572
Fax 310-859-0547
9301 Wilshire Blvd. Suite #614
Beverly Hills, Ca 90210
The finest compliment I can receive is a referral from a trusted client.
* Important Please Note:
Trading commodity futures and options involves substantial risk of loss.
The recommendations contained in this letter is of opinion only and does not guarantee any profits.
These are risky markets and only risk capital should be used.
Past performances are not necessarily indicative of future results.
posted by Cannon Trading at 1:17 PM
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