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ShadowTrader Video Weekly
The video below is produced by ShadowTrader.net founder, Peter Reznicek. Each video contains a look ahead at what the market is going to do next week, along with what sectors/stocks are about to move, and specific trading ideas for the coming week ahead.
At ShadowTrader.net we believe that every investor's success begins with a good trading plan. For maximum benefit, please review the enclosed video prior to start of your trading week.
Grab some popcorn and enjoy!
Shadow Trader Video Weekly 08.03.14
The tone has changed
Key support points on major averages coming together
What I'll be buying when support comes
tastytrade Clip of the Week
In case you haven't heard, there's a new financial network out there from the creators of thinkorswim called tastytrade. It's a funky mixture of options education, comedy, and sage trading advice. Brad and Peter of ShadowTrader have their own show for an hour each day called ShadowTrader Uncovered where they update viewers on the state of the markets, dissect the market profile, check out unusual options activity, walk through a few live trades, and field emails and calls live on the air. It's happening daily at 2pm EST on tastytrade.com. thinkorswim account holders can watch and trade at the same time by turning on Trader TV in the gadgets panel on the left side of the platform.
Each week, we'll rummage through the archives to find a great clip and post it here....Enjoy.
Peter takes questions at email@example.com
Brad can be reached at firstname.lastname@example.org
Aired on:July 30, 2014 - Using Large Offers on Level I as Clues. What happens when you see that a stock is consolidating at the high of the day and the inside market on it is 4 x 250? What does that mean and how can you profit from it while daytrading? Brad and Peter dissect a trade in LOCO (that crazy fried chicken stock) where this happened just last week and set up a move higher.
ShadowTrader Weekly FX Recap
ShadowTrader Weekly FX Recap is your weekly scoop on all things Forex, with fresh content catering to both the experienced FX trader and those just starting to get their feet wet. ShadowTrader Pip Academy is a weekly online lesson where traders will learn the basics of the Forex market, technical analysis, and fundamental analysis as it applies to trading currency. ShadowTraderPro FX Trader Live Call of the Week will highlight as actual trade taken in the newsletter over the past week and recap the setup and successful execution of the trade from start to finish. Things You Should Give a Pip About is a look at ahead at the news and markets that you should be paying attention to in the coming week to improve your chances of success in the currency markets.
ShadowTrader Pip Academy
Market Forecast Cluster
This week in pip academy, we look at the second trade signal which is the Market Forecast Cluster.
The cluster occurs when all three lines enter above 80 or below 20 at the same time. This is an indication of price being overextended and poised for a pull back or reversal. If all three lines have a value below 20, this is considered a bullish cluster and we can begin to watch for a bullish reversal. If all three lines are above 80, this is a bearish reversal and we begin to look for a bearish reversal.
There are many ways to get confirmation for the trade and it is also possible simple to take the trade with no confirmation. As with all indicator based systems, trading without confirmation provides a higher reward risk ratio but a lower probability as the attempt is to enter the trade as quickly as possible. Waiting for confirmation can greatly improve your probabilities but it also reduces your reward risk ratio as waiting for confirmation means waiting for price to move which is lost price opportunity.
Generally, I like to look for confirmation and do use confirmation when setting up trades on the newsletter, electing the higher probability route.
Note in the chart below how when all three lines entered the lower reversal zone together, this was the lowest day of a down trend for the NZD/USD. Following the cluster, the pair reversed trend direction and began a bullish trend.
As a side note, if all three lines stay in the reversal zone or in a cluster for four days or more, do not expect the reversal to take place. This usually is an indication that trice will bounce temporarily and continue in the same overbought or oversold direction.
In next week’s pip academy, we will discuss the near-term divergence.
ShadowTrader FX Live Call of the Week
The trade of the week is on the GBP/CHF
The reason this makes the trade of the week is because we timed and exit and avoided a significant loss. We set up our trade when price was continuing to trade in a long term bullish candle. We bought in on a break out through resistance. Price attempted multiple times to move higher only to be thwarted and pushed back down to retest support.
After a new failed attempt and 5 days of price trading at support unable to break through resistance, we determined that the bears were winning out and it was time to exit. We set our exit to breakeven and price rallied up to exit our trade with no gain. On Thursday, price broke support confirming our sentiment and on Friday, price tumbled over 120 pips past our original stop loss. We avoided hundreds of dollar loss and we will watch for a new, better entry.
To get daily FX analysis of major pairs, economic data, and live, real-time trades on currencies every day, follow the ShadowTraderPro FX Trader on MyTrade. This service is now available for FREE. All you have to do is click on "Tools" tab on your TOS platform or go to www.MyTrade.com and "follow" ShadowTraderPro FX Trader.
Things You Should Give A Pip About
In things you should give a pip about,we look at jobs data.
On Friday, nonfarm payroll came in lower than expected. The jobs forecast number was supposed to be 231k new jobs and, instead, we only saw 209k jobs created. Unemployment rose from 6.1% to 6.2%. The unemployment data seems to support the Federal Reserve’s comments that there is still slack in the employment market. With jobs data confirming the view of the Federal Reserve, we can also assume that the low interest rates will most likely continue through the end of the year and into 2015. If jobs data worsens, then we may even see a delay in the end of the Fed’s bond buying program.
ShadowTrader Free Weekly Trade Idea
Each week Peter and his minions scour the markets to find the best equity and forex setups for the followers of the Swing Trader and FX Trader. Premium subscribers get 2-5 of these daily. Every weekend we present one trade idea from either the equity or the forex side here. Note: Free weekly trade ideas are strictly DIY (do it yourself!) and are not actively managed or updated once presented and may or may not be stocks that are currently in play in our newsletters. For a more "full service" feel, with real-time email alerts and updates, please check out the ShadowTraderPro Swing Trader and ShadowTraderPro FX Trader
Analog Devices, Inc. (ADI) - Long
Entry - 48.45
Stop - 47.10
Target - 53.00
ADI is in a technical position to move in kind with a reversal by the S&P 500 Index (SPX) as discussed by Peter in this week's ShadowTrader Video Weekly.
This stock has its own long term trendline originating from the lows of August of 2011. As of Friday's close, the stock was within 1.60 of touching the trendline which equals two average daily true range measures (ATR, 14).
We're looking for a reversal from this level with an initial target at 53.00 which is the recent swing low(blue line). A protective stop is placed 1.5 times the ATR(14) below the entry.
For an average of 2-5 trade ideas like this every day along with daily market analysis and trading guidance, follow the the ShadowTraderPro Swing Trader. This service is now available for FREE. All you have to do is click on "Tools" tab on your TOS platform or go to www.MyTrade.com and "follow" ShadowTraderPro Swing Trader.
ShadowTrader Pairs Trading Corner
"XEL - CMS"
Xcel Energy - CMS Energy "It's Alive!, It's Alive!, Yes Herr Docktor!" Well, it's not everyday, that we have to turn up the power to bring life to our Frankentstein Creation, but we all certainly enjoy the energy that we utilize each day in every aspect of our lives. This energy pair has by far been a superstar for our pairs trading port-folio, and we are excited to share it with all of you every chance we get for both long and short trades.. : )
Technically speaking, the pair has strong correlation of 0.90, and range of movement reaching out 0.50+ to 0.70+ above the mean. The RSI Wilder is mid-range at 98.3, and very much overbought at these levels. We are already short the pair at $1.98, and now we will likely add another layer at/above $2.05+ if the pair stays strong and pushes higher on Monday's price action.. ; )
It's Alive, My Creation Is Alive!
Want to know more!, check us out at ShadowTrader.net and go to the pairs archives for viewing and reviewing. As always, catch us at the "Pairs Hour Show" at 4:15 - 5:15 EST every Thursday.
Be sure to look for any new pending trades coming out (Sunday) evening for (Monday's) Newsletter..
For the newbies:, Peter has created this short video to get you started. You can watch it here.
Any questions, email us at email@example.com and Tom Cook will get back to you with a reply.
The Pairs Hour with Tom "The Southern Gentleman" Cook is happening on Thursdays at 4:15pm EST in the ShadowTrader chatroom on the TOS platform. Last week's show is archived here. We enjoy and encourage everyone to bring your suggestions, comments and questions to us each week during this program.
You can get real-time text messages sent to your phone every time we trade or post a new newsletter. Just text "follow st_pairs" (without the quotes) to 40404 on your cellphone. No twitter account is needed. Enjoy.
What's New at ShadowTrader.net
ShadowTrader Uncovered is live on tastytrade every weekday from 2 to 3pm. Tune in to watch Brad and Peter give their unique spin on the markets.
James Dalton ShadowTrader Webinar James Dalton recently did a market profile webinar during our tastytrade show on Monday, December 30th, 2013. A recording of the webinar is HERE.
ShadowTraderPro Pairs Hour with Tom "the Southern Gentleman" Cook - Thursdays, live on the TOS platform. A 1 hour program on the basics of pairs trading. Tune into the ShadowTrader chatroom under the Support/Chat tab on your platform at 4:15pm EST.
ShadowTraderFX Hour with Blake Young - Tuesdays, live on the TOS platform, Blake is hosting a 1 hour program on all things Forex. Tune into the ShadowTrader chatroom under the Support/Chat tab on your platform at 4:15pm EST.
Twitter & Facebook - Did you know you can get real-time tweets when ShadowTrader advisories send out newsletters or trades? Just text the following (without the quote marks) to 40404 on your cellphone. Twitter account not necessary.
For Swing Trader text "follow st_swing"
For FX Trader text "follow st_fx"
For Pairs Trader text "follow st_pairs"
For Weekend Update text "follow st_weekend"
ShadowTrader is also on FaceBook at the link below