Strategic Trading Insights: Navigating Myths, Markets, and Volume Profiles
• Discussion on the ‘Jerry trade,’ a pre-market closing strategy to leverage potential overnight market movements.
• Techniques for managing trades in ThinkOrSwim, including ‘box trades’ and the use of groupings to organize and control trade entries and exits.
• Insights into futures contracts and the implications of trading hours, contract expirations, contango, and backwardation.
• Examination of the psychological and actual impacts of market gaps, challenging the validity of gap trading strategies.
• Comprehensive guide to setting up volume profiles in ThinkOrSwim, from granularity to eliminating arbitrary constructs like HVNs and LVNs.
• Exploration of market memory and structural analysis, leveraging volume changes for long-term trade significance.
Summary
The Zero DTE daily meeting delved into multiple facets of trading strategies and market analysis. Ernie, a seasoned trader, shared his perspective on the ‘Jerry trade,’ highlighting the strategy’s simplicity and effectiveness in capturing market movements. The discussion also covered practical trade management on the ThinkOrSwim platform, focusing on the benefits of using ‘box trades’ and organizing trades into groups for better oversight.
Ernie provided a nuanced understanding of futures contracts, discussing the nuances of trading hours and the dynamics of contract expirations, contango, and backwardation, which can significantly affect trading strategies. A significant portion of the meeting addressed the misconceptions about market gaps, with Ernie challenging their perceived importance in trading decisions.
The session concluded with an in-depth tutorial on setting up and interpreting volume profiles in ThinkOrSwim. Ernie emphasized the importance of distinguishing between arbitrary constructs, such as HVNs and LVNs, and the genuine market memory reflected in volume changes. He guided members on how to conduct a structural analysis that captures long-term trade significance, rooted in real market behaviors rather than common myths.