STOCK MARKET FUTURES IN THE CROSSHAIRS

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This post continues my explanation of TRADING IN THE CROSSHAIRS.

A stock moves in the direction of the major indices (e.g. DOW, S&P, NASDAQ, etc) or, at the very least, is supported by their momentum unless there is some corresponding news event that causes the stock to move in the opposite direction.

There are two futures charts that I pay the most attention to when looking for high probability set ups on my individual stocks and/or ETFs.  They are the S&P and NASDAQ futures.  Let’s take a look at the current charts for each.

S&P FUTURES

NASDAQ FUTURES

Once I locate a CROSSHAIR on a stock or ETF, not only will I look at several time frames of the stock or ETF itself but I will also look at the futures to see if I there is corresponding confirmation.  In my most recent trades I wanted to see if my potential long positions would have the strength of the futures behind them.

Take for instance the APACHE ENERGY (APA) trade:

This trade was initiated for several reasons, all of which add up to a high probability CROSSHAIRS trade:

1.  A CROSSHAIR.

2. A break out above recent resistance.

3. A strong move off 50 TANKS.

4. The WEEKLY chart shows no potential resistance and is above the 200 TANKS.

5. The S&P futures finding support off the 50 TANKS.

6. A potential move from the 95 level to the 100 “psyche” level, which would correspond with the potential resistance level on the S&P futures chart.

All of these add up to a high probability trade and are part of my INTELLIGENCE REPORT.

Bottom line is this: unless all of my rules are met, beginning with the CROSSHAIR, I do not make a trade. Period.  To do otherwise would be to break the rules.  In the stock market, rules are not made to be broken.  Besides, I know that my pattern will repeat itself often enough for me to make money when the market gives me the opportunity.  Until that time I wait with my money safely in the bank.

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