A chart that says 3,000 words and when to enter trades

March 11, 2016 10:29 AM

E-mini S&P 500, 24-hour trading, 240-minute chart

This 24-hour moving chart gives you the ultimate view of the current stock market trend and overbought/oversold levels. I use simple moving averages to gauge trend and how far price is from a mean average price for a visual of how far the market is overbought or oversold.

Also, I use these movong averages (MA) as possible support and resistance levels to add confirmation when other indicators I use confirm at the same price and time.

At the bottom of this 24-hour chart you will see my custom panic selling volume indicator. When this spikes I know traders and investors are fearful and panicking out of positions. That is when I start looking for bottoms because I want to take the other side of these emotional trades placed by the masses.

SPY daily chart

The daily chart of regular trading hours has many different characteristics from the 240-minute intraday chart. Where the 24-hour chart above shows ALL PRICE ACTION, the SPY only shows 1/3 of the days price (9:30am – 4pm ET). This is when most of the day’s volume is traded and I like to see how the masses/average joe traders perceive the market.

I use these time frame just for my cycle analysis which allows me to identify the market trend/direction (pink cycle line), to identify short-term noise or counter trend moves within that uptrend using the shorter cycle analysis (blue line).

Both of these cycle lines use a combination of the most active cycles in the market across multiple time frames and then are blended and weighted into one line. This tells subscribers and me where the market is most likely to move and when it should be struggling or reversing.

In fact, I saw the pullback coming in stocks and shorted the market for a quick counter trend trade, and exited it Thursday morning, and then go long again and this new SSO long S&P 500 trade is already up 3% within a few hours for us. Very exciting stuff to say the least.


ES regular hours 9:30am – 4pm, 30-minute chart

This is one of my trading signal systems that I am building which will identify these market conditions and will eventually autotrade them. This is my newest improvement and is still a work in progress, but I expect it will replace some of my other systems later this summer. My focus is to have something like this trade futures and the SP500 ETFs.

With hundreds of indicators and timeframes to view the market 99% of them are lagging indicators and just duplicates of the same useless information. You only need a handful of tools each analyze the market in a different way and that’s it. When they are all inline, then you have a screaming buy, sell, or profit taking level in the market.

I should mention that all these core indicators and tools are explained in detail and provided within my book “Technical Trading Mastery – 7 Steps to Win with Logic.”

If you want to know with a high degree of accuracy where the market is headed each day, week and over the next month… and be able to spot extreme overbought and oversold levels to enter, short, or take profits and tighten protective stops then I urge you to join my video newsletter and trade alert service at here.

About the Author

Founder of AlgoTrades Systems., internationally recognized market technical analyst and trader. Chris is also the founder of TheGoldAndOilGuy.com, a financial education and investment newsletter service. He is responsible for market research and trade alerts for of its newsletter publication.