February 12, 2015

A Welcomed Return of Volatility & 2-Way Trade, Chart – $CL_F

Welcome back my friends to the show that never ends

We’re so glad you could attend

Come inside! Come inside!

© 1973 Emerson Lake & Palmer



resolutionOne of my resolutions for the New Year is to return to posting on a more regular basis than how I finished 2014. My apologies for the long periods of silence, but I was taking some needed time away from writing and dealing with a bum gallbladder, which was removed at the end of January. I also was focused on trading and starting the Logical Signals Trade Room. The room opened in September 2014 and is off to a great start. I am enjoying trading and working together with a great group. I am looking to add new subscribers (10 to 15) within the first quarter of 2015. If you have an interest please drop me an email – Michael@mjf1partners.com

volatilityrisk2015 has started off in a grand way with a solid return of volatility and stronger 2-way trade. This was something that was seriously lacking for the better part of November and December within the equities markets. Commodities and the U.S. Dollar however, saw some serious upticks to both price movement and volatility.

The first six weeks of 2015 have been much better than I expected. Volatility has returned and I believe is welcomed by both the bulls and the bears. Thus far the markets have not been one sided in either their declines or rallies. The intensity of the moves though has been kicked up a few notches that in turn have brought large pots of gold at the end of many rainbows for day, swing and position traders.

fingerpointing While the moves themselves have not been unexpected I’ve been so engrossed in trading the moves that actually taking a step back to see where we are with regards to the larger pictures has come screaming back as the equity markets close in on new all time highs again. This on the back of reaching new multi month lows just seven trading days ago. That’s how amazing it has been!

The NQ, ES, and YM have been experiencing a slow down in volume over the past week, but the intraday moves have more than made up for the long periods of waiting through some “chop”. As of Thursday, the ES, and NQ came within 3 points of new all time highs for the ES and new 15-year highs for the NQ. The YM needs another small rally of 116 points to clear the all time new high hurdle.

The moves themselves have been very long in the making and while many have been flipping over to a more bearish stance I have continued to maintain the necessity of new highs still being out there on the horizon. That moment has now arrived. I will be doing some additional analysis to begin to put zones together as to where I believe the indexes will peak for the current rally phase. It is safe to say though that thus far everything appears to be right on schedule as rallies remain Elliott 5-wave structures and declines 3- wave structures. This has kept the bull market intact and frustrated the bears. Look for more on the broader indexes over the next week.

I have spent sometime getting reacquainted with Crude Oil and have started trading the future, (CL) on a daily basis in late November. Thus far the monster decline off of the $107 highs from last summer have provided more opportunities that you can shake a “oil stick” at. Volumes have been consistent with solid two-way trade each day, creating the perfect scenario for day trading. A nice add is that Crude is actively traded during the overnight Globex session, which is almost better than my daily ration of espresso. Check out today’s chart for additional discussion and trades.



keyinsandRemember the key is being able to reduce and separate the “noise” from opportunity. This takes knowing and executing a well-defined strategy and allows you to see opportunities amongst the “chaos” and by trusting the mechanics of your strategy, be able to take advantage of them. 

Opportunity continues to knock on our doors.  While it doesn’t come without risk, risk can be defined and more manageable. Volatility and broad moves are exactly what a day trader desires and being able to respond without questioning is a luxury many are unaware of. 

tradersThe Logical Signals Trade Room is up and running. We have an outstanding group of members that have already begun contributing across the board from trading indicators, patterns and products, to computer software and hardware.

Thus we are ready to move on to phase two of membership/subscriptions. Now that a core group has been established we have a few additional spots for other traders that may have an interest. Phase two, though will be somewhat more involved in that prospective members will get a chance to talk in more detail on their trading goals, experiences and expectations with me and possibly other members before deciding to join.  At this early stage it is important to continue to steer the room in a direction that favors all of the members. Should you have an interest please contact me at Michael@logicalsignals.com  – currently we have 10  to 15 additional spots open before closing the room to new members.

Steer the course and don’t compare yourself to everyone else. You are not they and they are not you. Remember to trust and believe what makes you unique at this moment in time and in this situation and allow others to choose for themselves. Don’t be swallowed up by the chaos and false emotions swirling around. Remember it’s just a number.