Mentor Mike’s Fastest Grand-A-Day Ever!

Mentor Mike’s Fastest Grand-A-Day Ever!

Fellow Traders:

Today, at 5:30am PDT, the Unemployment Rate report came out.  Ever since the recession began in ’07, this report has been the foremost meter of the nation’s economic health.  It can produce a quick, temporary and substantial knee-jerk reaction in the market depending on whether the actual rate is better or worse than the pundits’ predictions.  Last month’s rate was 6.7%; this month’s was predicted to improve to 6.6%, suggesting a possible spike to the upside.

When I looked at my charts this morning, prices seemed to be hovering around the Trend-Definer on all time frames.  You know that the large Parabolic SAR changes direction at or about the point at which prices cross the TD.  On my 21-min and 5-min charts, the large PSAR was quite some distance below the TD.  But on the 1-min chart, the PSAR was just barely above the TD.  This suggested to me that an upside breakout was the most probable.

I did something I rarely ever do.  I combined fundamental data (the predicted improvement in the Unemployment Rate) with my technical analysis, and went long at about 5:22 am.  When the price slowly drifted lower before the announcement I became more confident.  Institutional traders and other pros will sometimes try to move the market in the opposite direction to improve their entries for the actual breakout.

Turns out the new Unemployment Rate was way better than predicted: 6.3%.  The market took off like a rocket.  Normally, a three-target trade earns me a little over $600.  But, the price rose so quickly, it was up two full points before my first 6 contracts could be sold.  Hence, one, 9-minute trade earned $1,008.50.

Since I’ve been writing this, the market has already completely retraced the previous rally and dropped lower than where I started.  Most of the time emotions are our downfall.  Today, they were my ally.  Have a great weekend.  See you all back in the TRADING ROOM on Tuesday.

Today’s Charts

Here are today’s screen captures.  They may include my personal chart, the TRADING ROOM demo platform, charts submitted by students and/or my running intraday Elliott Wave count in the S&P Emini.  Please click on a chart to make it larger.  Chart #1

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