Trading The SPI - NON-Gann Techniques

[nat]

morning all-
Cheers for the article Ed, would make for great trading if it all fell to pieces like the nasdaq did

In regards to this morning's gap nat, what I'd be looking for is a gap open with a decent spread between the cash and futures(30-40 pts), and I'd be looking for a move down through a pivot level in the first 5 minutes or so. For these types of plays, I like the see the futures moving down well before the cash opens.
This morning on open, the spi was trading at less than a 20 pt premium, and the spi gapped up above R2 and held there leading up to the cash opening, which for me, makes it just as likely to be a gap and go kind of play, as opposed to a gap and fill one.

ok then thanx for that professor, just wondering to do with spread between futures and cash, for a little while futures has been at a discount during day of 20 to 30 points but this morn first up was at a premium it has now gone back to status quo, could that be factored in or still not worth condsidering. Nathan

 

[Bronte]

Good morning guys...
"Happy Valentines" :1luvu:
The SPI usually gives us a present around its anniversary:

Todays SPI "Gap Open":

 

[professor_frink]

ok then thanx for that professor, just wondering to do with spread between futures and cash, for a little while futures has been at a discount during day of 20 to 30 points but this morn first up was at a premium it has now gone back to status quo, could that be factored in or still not worth condsidering. Nathan

It could be- I haven't been following the spi closely lately, so haven't been aware of what the spread has been like the last couple of weeks. If it has been at a big discount, then pops up to a premium on a gap opening, then I'd be more inclined to fade it. It still didn't fulfill my primary trigger for a short, as it didn't break down through the pivot level during the opening period. If you want to look for this type of trade, it may be a good idea to look for more than one reason(the spread) to take the trade. If it turns out to be a gap and go open, then you'll want a sensible place to put a stop that isn't going to cost you too much when you're wrong(and it will happen for this type of play). It doesn't have to be a pivot level, could be normal s/r, fib levels, etc.

A stop above the opening bar on a 5 minute chart would have gotten you stopped out just before the move down began, so you have to be careful of that kind of stop(I haven't done any kind of testing on this kind of stop, so it may have been the exception, DYOR).

 

[nat]

thanx for help professor ,Nathan

 

[professor_frink]

thanx for help professor ,Nathan

no worries mate

 

[wiseguy]

gday fellas

i believe this is my first post here so heres my contribution
its a bit of info on trading the opening gaps
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1070+14719,00.html

Besides the SPI200, i also follow the ftse, dax and sp500. all of which seem to respect pivot points pretty well, however when i apply pivot points to the spi200, it rarely seems to work too well? Am i missing something? Do you guys calculate pivot points based on the day & night session, or just day?

Cheerios

 

[Bronte]

G'day wiseguy & a big welcome
Thank you for the link / information.
We work out our SPI pivot points on:
Daily OHLC (with and without the night session)
Weekly OHLC &
Monthly OHLC

 

[Edwood]

yes thanks for the link wiseguy, some useful stuff in there!

 

[Bearman52]

gday fellas

i believe this is my first post here so heres my contribution
its a bit of info on trading the opening gaps
http://www.cbot.com/cbot/pub/cont_detail/0,3206,1070+14719,00.html

Besides the SPI200, i also follow the ftse, dax and sp500. all of which seem to respect pivot points pretty well, however when i apply pivot points to the spi200, it rarely seems to work too well? Am i missing something? Do you guys calculate pivot points based on the day & night session, or just day?

Cheerios

Hi Wiseguy
an interesting observation
I am a daytrader and "WILL NOT" hold positions overnight and agree that a longer term trader could probably view this differently.
I have traded the SPI since 1986 and it has been very kind to me ,I also trade the DAX the ES & ER Minis, concentrating primarily on the US contracts these days (yes market times are inconvienient for Aust) because I have found over the years that unlike the SPI which is comparitivley thinly traded and can be adversly moved against a position by only a handful of contracts
these markets adhere closely to Price Action and Technical levels and Points due to the tens of thousands of proffessional traders of these contracts worldwide that follow these methodologies .This makes it possible to trade in and out of positions all day long using very tight stops.
I guess what I'm trying to say is that my observations are similar to yours and that "I" certainly find the SPI a more fickle beast as regards adherence to the "RULES" I do however have a long time affair with it,and will bang about with a few contracts during morning trading especially if the sycom action seems to have put it out of balance. S&R about the opening price then becomes my main focus
JMO
BEARMAN

 

[nat]

Hi Wiseguy
an interesting observation
I am a daytrader and "WILL NOT" hold positions overnight and agree that a longer term trader could probably view this differently.
I have traded the SPI since 1986 and it has been very kind to me ,I also trade the DAX the ES & ER Minis, concentrating primarily on the US contracts these days (yes market times are inconvienient for Aust) because I have found over the years that unlike the SPI which is comparitivley thinly traded and can be adversly moved against a position by only a handful of contracts
these markets adhere closely to Price Action and Technical levels and Points due to the tens of thousands of proffessional traders of these contracts worldwide that follow these methodologies .This makes it possible to trade in and out of positions all day long using very tight stops.
I guess what I'm trying to say is that my observations are similar to yours and that "I" certainly find the SPI a more fickle beast as regards adherence to the "RULES" I do however have a long time affair with it,and will bang about with a few contracts during morning trading especially if the sycom action seems to have put it out of balance. S&R about the opening price then becomes my main focus
JMO
BEARMAN

Hi bear man ,just wondering is the way you trade the spi entering off a support or res level with stop other side ?What time frame during day do you work off of .Wow doing the spi since 86 thats a while ,how long did it take to get profiecient at it ? NAthan

 

[Bearman52]

Hi bear man ,just wondering is the way you trade the spi entering off a support or res level with stop other side ?What time frame during day do you work off of .Wow doing the spi since 86 thats a while ,how long did it take to get profiecient at it ? NAthan

Hi Nat
I trade off either side of the opening price depending on my view of the overnite action ie: yesterday looked for breaks to the downside
for this type of trading I use a 21 tick candlestick chart with an initial 4pt stop which I quickly move to break even as price can bang around a bit at this time of day I observe the candles like a Hawk and will often take the position off if I don't think it looks right b4 it runs back to the stop
for example yesterday there were 2 trade s b4 the 3rd one broke and the theory worked
and who said I was Profficient?
its just a job!
BM

 

[nat]

ok thanx for that ,if one has been trading that long and survived must have a method that works over time alright,Nathan

 

[Edwood]

just had another read of your gaps post wiseguy - interesting where he places his stops, some are pretty wide compared to reward, but hes only taking those setups with 80%+ prob of success. very helpful - cheers

 

[Bronte]

Good morning guys...
The SPI usually gives us a present around its anniversary:
Todays SPI "Gap Open":

Nice one point 'Gap' Edwood
Record High on 24th Anniversary
5971 Gap Open

 

[Edwood]

so do you think we might have a near term top in now Bronte?

unfortunately am away from the screen again this week, hope it goes well for everyone!

here's a bit more on the China bubble...

http://www.chinadaily.com.cn/bizchina/2007-01/26/content_793865.htm

 

[Bronte]

The SPI has given us plenty of "Tops" around this time of year Edwood.
16th February 1983 was the SPI's birthday.
24 years :birthday:

 

[nat]

Hi bronte ,well that clears a question ive been meaning to ask about the aniversary ,thanx Nathan

 

[Bronte]

You are welcome Nathan
It has been a great 24 years.
The index started at only 500

 

[Bronte]

6000

:band :guitar:

 

[Sean K]

6000

:band :guitar:

Where to from here Bronte?

I'm thinking 10% correction back to 5450 ish support.