Good Morning

Dow and DAX Scalping and Intraday Trading

The Dow took a serious hit on Friday and Asian markets continued the trend overnight. In spite of pretty good US GDP figures I think that many have come to realize that these figures are more to do with government intervention, than a real turnaround. Great DAX scalping was possible according to my scalping method described in this blog.

That said it is Monday today and many conflicting orders will be executed during the open until the ISM manufacturing come out at 10:00 EST. This is a highly respected report and we will see a reaction in the markets to any big deviation from expectation. The expected figure is 53 and a deviation of 1.5 or more will certainly have an impact. Something to bear in mind though is that the immediate market reaction is often faded before any continuation. Ford beat expectations but market reaction was mutes and as I type the Dow futures continue to drop. There are different ways to play this, one can wait for a retracement to the Fib 50% level or M3 just above at 9836 to go short, or wait even longer for R1 ar 9887 area. May never hit these levels intraday and may have to play with momentum (see scalping articles in this blog). It’s a tug of war between those who will buy a retracement thinking it’s cheap and those who expect Fridays decline to continue.

In any event some serious focus is required to get in at a good level, or indeed scalp for smaller moves. Numerous intraday trading opportunities were presented for low risk profits. Check this blog entries  for Scalping the Dax and Dax Scalping, The ABC of Profitable Trading.

There is also a video available here about Focus in DAX Scalping.

The USD continues to move with risk appetite and although the GBP/USD has a sharp up spike in response to UK PMI figures all of that is currently gone. With scalping it is always good to trade the reaction to the initial thrust, that is not to jump in but to wait for a reversion back to the 10EMA or the Bollinger band, as the stops required then are much smaller and one can get back into momentum without breaking the bank.

I’m sure it will be an interesting day, play it well and safe.

Cheers,

Mark Meir

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