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21 SPZn.lb 40880 =0 -215 41310 40840 41190 04-24 11;45  4iaoo 41750 417B0 41650 41600 41550 41500 41450 41400 41 0 41300 41250 41200 41150 41100 41050 41000 40350 40500 46850 4OSO0 40750 4 70 49650 40600 40550 yrZM.S tllM 41660 OS-Ob :58 -15 41 llbOb 41V40 3 a 3 llllili!lb,.llilnlililllll„iMl llll 10 12 1 III ll 3 418 0 41840 41830 41820 41810 41806 41790 41780 41770 41760 41750 41740 41730 11720 41710 41700 41640 41680 41670 41660 41650 41640 41630 416Z0 41610 41600 Illustration 9-7 A bar chart of less than a ten-minute timeframe does not give a trader an adequate perspective of the immediate trend, and the shorter time-frame charts, such as a five-minute bar chart, often become too choppy during a sideways market. See illustration 9-8. On the other band, a sixty-minute bar chart may not yield enough trades to keep your interest. I have found fifteen-minute harcharts to give enough tiata to get a good idea of the immediate trend, and an adequately large perspective so as not to lose touch with the overall market behavior. Atthe same time, the fifteen-minute bar chart is responsive enough to catch smal ler Symmetry Waves ami to generate enough trades to keep even Ihe most avid day traders busy. Illustration 9-8 As these illustrations show, and as I mentioned eadier, the first issue to be resolved with day trading is the time frame to be used, so there wont be conflicting perspectives. One of the ways aconflictingperspectivemanifcstsitself is when the fifteen-minute bar chart and the five-minute bar chart give trades in opposite directions. In illustration 9-9, the S&P fifteen-minute bar chart shows the trend to be down, and it has given a sell signal (retracement wave IV), whereas the five-minute bar chart is in an uptrend and is giving a buy signal (retracement wave 4); see illustralion 9-10. 00010001020109020102010002010101160008230200061002480189480200010100011006110705080102020801020200010201021100
sFzn.ib 11 0 aib 4S moo 41200 41370 05-19 09-.b?  lilustraiion 9-9 i<ilitililiitilii,iiiililliilll!llliiliiiilillllllllllliil a 11 12 13 14 15 IB 19 SP2I1.5 41300 mo -4S 41400 41200 41370 05-19 09:58  41920 41080 4184» 41800 417f.0 41720 41680 41640 41600 41560 41520 41480 41440 41400 413<>0 41320 41280 41240 41200 41160 41128 41OB0 41048 41000 48960 40920 41400 41385 413V0 41355 41340 41325 41310 41295 41280 41265 41250 41 41220 41205 41190 41175 41160 41145 41138 41115 4Uee 41085 4107S 41055 41040 41025 the importance of basing day trading on a single time-fiame is emphdsized for the sake of ronsistenty and clarity of purpose. In the scenario depicted in illustration 9-9, basically there were three chorees: (11 to go short using the tifteen-minute .Symmetry Wave (wave IVI, or (21 lo go long using the five-minute Symmetry Wave (wave 4), or (.3) lo first go short using the fifteen minute Symmetry Wave and then go long using the five niinule Symmetiy Wave. 1 find it best to use one time frame to trade with, i-low you choose to trade will depend on your trading style. Whatever you do, try to confine yourself to watching only two time frames at most. The S&P market, like all markets, has two identifiable phases, sideways markets (or consolidations) and trending markets. See illustration 9-11. SP2t1.15 nm 41310 tttS 3S 41408 41200 41370 05-19 09:55 \ , -  e 11 12 13 14 15 la Illustration 9-11 41920 41880 41840 41800 41760 41720 41680 41640 41600 41560 41520 41480 41440 41400 41360 41320 412 0 41240 11280 41160 41120 41880 41040 41000 4O%0 40920 B +: :.:::::./++2$:.::�::+ 2/. +�72 ��
Symmeiry Wave works best during the trending markets. One way to gauge the trend of the market is to use the slope of a five- to eight-day moving average (see illustration 9-12). The simplest way is to train your eyes to .see when a maikei is trending and when it Is not. SP2n,5 niN 41640 tilO -gS 41720 41575 41650 41659 65-20 10:3b n 5  SHAKP SLOPE Of TIIE HOVINf; AVERACjr: iNDiCATf: A STRONG TRENr). Illustration 9-12 :1,1[1{.11 111 lllilillliiiiiyillllllii.li..j.....Iiliiill llltllllll 41775 4 0 41725 41700 41675 41650 41625 41600 41575 41550 41525 41500 41475 41450 41425 41400 413VS 41350 41325 41300 41275 41ZS0 41225 41200 4117S 41150 • It is advisable to day trade only one market. This is because its not possible to efficiently track two markets within a single day at the same time. Furthermore, each niaiket has Its own nuances, and u is important to rune into the specialized nature of a market. Bv trading more than one market, the nuance of a particular market is lost. • Trade when the market is in a strong trend. Incidentally, all charts in this chapter are by Fnsign Software. They can be reached at 2641 Shannon Ct., tdaho Falls, ID 83404, Phone: (208) 524-0755. 10 11 12 1 Z 38 9 10 11 12 1 2 3 8 10 To cover the cost of commissions and slippage associated with the execution of trades, it is important to day trade only the most volatile and liquid markets. The favored market of day traders is the S&P 500. the illustrations in this chapter are in the S&P market. Other Suggestions And Observations: • Ihere are few 200-point profits, more 100-point profits, and far more 30-poinl profits. • Use wide .stops. For example, a point slop-loss is preferable to a 30 point stop-loss. Im in for a lot more 100 point winners, and lhat makes a big difference in my final net profit totals. • To clarify the wave count and to gel an overall picture of the market, go back to a bigger time frame. 611316
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