Commodity Futures Trading Using Fuzzy Logic and Market Synchronization Clues, PART 2
By: Thomas Cathey | Posted: 15th June 2007
There's nothing better than fuzzy logic for determining when a commodity market has begun a new trend and is starting to synchronize. Read on to find out exactly what this is all about...
Observation From Trading Notes:
"After an e-mini futures top forms over 1-2 days with big contracts and multiple tops, look for the last rally to labor up all day AFTER a sharp and fast down opening with poor A-D line. Key: It will spike or touch the 5 min chart channel one last time. This is the best place to short."
This is another familiar e-mini futures pattern. In this case it's a big set up for a big move. There are always some kind of preparations for a big move. Your job is to identify them. These are patterns that will repeat every 5-10 days or so. The anemic rally is the key. It’s like the market is running out of gas and getting tired. That last stretch to tap the channel in a weakened state is an e-mini short trade you should jump on. It is a "high probability" trade.
If you stalk this trade, focused and patient, you will find your share of these kinds of set ups. Notice they are not rigid, computer system type patterns. Making sense of them requires the fuzzy logic of the brain that is looking at many indications and patterns at once. You will get to the point where you can simply feel you’ve been there before in a general way and know that this means a short sale.
There’s no computer program that can do the same integration at this time. There will be someday, but for now the extraordinary commodity futures traders, the superstars who earn $millions+ a year, are mostly discretionary (fuzzy logic) people using computers to do the raw number crunching - the grunt work.
Good Trading!
There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.
Thomas Cathey - 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his market forecast TimeLine Trading charts and get his complete 44+ lesson, "Thomas Commodity Trading Course - all free." http://www.thomascapitalmanagement.com/commodity/welcome.htm Main site: http://www.ThomasCapitalManagement.com
About the Author
Occupation: CEO and Money Manager
Thomas Cathey - 27-year trading veteran heads the managed futures division of Thomas Capital Management, LLC. View his TimeLine Trading market predictions and get his complete 44+ lesson, "Thomas Commodity Trading Course." http://www.thomascapitalmanagement.com/commodity/welcome.htm Main site: http://www.ThomasCapitalManagement.com
There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.
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Tags: ups, new trend, commodity market, set ups, number crunching, grunt work, using computers, risk capital, trading futures, futures and options