WHAT A FANTASTIC DAY IN THE TRADING ROOM …VAHID IS and continues to be A LEGEND!
Vahid opened the room an hour before the normal start at 08:20. The reason was the huge news being released today concerning GDP Gross Domestic Product (GDP) Annualized change in the inflation-adjusted value of all goods and services produced by the economy;
Once again we saw the market break North before the official news was released. PLEASE LOOK AT THE CHART BELOW!
Vahid projected the rising candle to return to where it started and sure enough after a few minutes we saw some normality return. The Chart below explains it all as it happened. Please refer to the chart to understand the way things played out as you read the summary below.
Vahid showed patience to wait for a definite trade set up while we all watched the up and down movements after the news was released at 08:30 US time, (1 hour before the market opened).
In the chart below, we can see how the green resistance line is being respected even after the big move up on the news release. There were no less than 14 attempts to break this line!
When the market opened at 09:30 we saw Vahid take a short position. Vahid explained once again that the overnight trading in shares included in the S&P 500 like Tesla, had a huge gap to the upside from the close of last night. Around 50% of the time this gap will close with buyers and sellers moving the market to CLOSE this gap. This played into our hands !
When the market opened at 09:30 we saw Vahid take a short position. We anticipated that with the failure to break the upper green resistance line and the gap likely to close the market would move lower.
Vahid was proved right again and our accounts were all quickly in profit and 2% was bagged.
The eagle eyed among you will see this was a massive sell off RED candle which dipped almost 0.8% in the space of 15 minutes. Do not get confused with the 2% win and lose positions we take for most of our trades. The 0.8% dip does not equate to a trading win or lose, since this is a dip in relation to the whole market. When we see on the news the S&P 500 dipped 1% today, this is measured against the overall market high and low, and not a single traded position.
When we see a massive and rapid sell off like this (around 0.8% in a 15 minute candle), and there is strong support and resistance in a narrow band, we often will see bounce back. This is what happened in the following candle.
It was not until 10:30 EST we finally saw a clear break, but the following big red candle failed to confirm the break, pushing prices once again lower.
Study the chart below and you will learn a great deal about today’s struggle with bulls and bears, and how the market gave us opportunities to trade if we know what to look for. Vahid did and thanks to him we bagged another 2%.
One subject we discussed was “the spread” brokers apply to the market price. As we know we can either take a buy or a sell trade. If we look at the prices before we trade, we will see there is a “gap” between the two prices. This is known as the “spread”. Typically the spread will be around 0.75 between the buy and sell price.
Pay attention to this, as some brokers will charge more. Over time this can add up and dent our profit potential. See what your spread is, and if it is greater than 1 point, it could be time to look for another broker.
Don’t forget to download the telegram app and get ready for the trade set up alerts. When Vahid see an opportunity for us, he will alert us on Telegram with a video to explain in order for all of us to get involved if we choose to.
More updates tomorrow, but today was a fantastic day, and very well done to all who took part and learned more from our mentor.
Thanks again for your continued support for these updates, very pleased to contribute and help with the days analysis and review of important topics when I can.