2008 11 12  Nate Brooks Personal Daily Preparation Notes

Key Reaction Times of the Day (Central Time)

For those that want to know which specific report is coming out each day please check the data at http://www.nasdaq.com/asp/EconodayFrame.asp . These notes identify the times that the market may react on a Daily Basis so I will keep these times at the forefront of your mind…not the specific report. Those reports generally will come out at one of these times. One of the additional things I have noticed in scary times, the Fed will make an announcement and that usually happens unannounced around 8 am when they do make these announcements. With that said here are the times you should be aware of:

7:30 am   – Early economic reports are released at this time, when released

8:30 am   – Market Opening…always wait 5 minutes before taking any trade

8:45 am  – Many times a minor market reversal takes place…be aware of that if you are in a trade

9: 00 am – Generally either a key Breakout Time, +/- 5 min, or a Countertrend opportunity

9:30 am – Market has tendency to stall or reverse for a Countertrend trade, +/- 5 min

9:35 am   – Oil and Gas Reports on Wednesday and Thursday

10:00 am – Market makes a push to drive market in desired direction and volume begins to slow down

10:40 am – European markets close in 20 minutes so you may see a push to start happening some days

10:45 am – Up to 11 am, a big move may begin, usually only if the market has been relatively quiet

11:45 am – Up to Noon, New York traders back from lunch and reestablish direction for afternoon

12:15 pm – Up to 1:00 pm, usually 1^st possible Post Lunch Move. Resumption or Countertrend

12:30 pm – Bar ending at 1 pm usually sets the direction for the afternoon and the 2:30 trade setup

1:15 pm   – Fed Day announcements come at this time

2:00 pm – Depending on the 1 pm move or no move, this will be a Countertrend or Resumption

Price Action Flow Analysis as of 7:00 am to about 7:15 am each day

Globex market was trending in a 25 point range from a high of 911 to a low of 886. Always know these numbers because a breakout of either end in the upcoming trading session may be a trading opportunity. Also, failure to breakout of these numbers after a test also tells you important information

The last valid %K on the 60 min chart  took place from 1:30 to 4:30 am in the downward trending direction. The last valid % K on the 15 min chart took place from 6:00 am to 7:00 am in the downward direction. When the market opens, look to see if % K is still in the trending mode after the first bar has Closed on the 15 min chart OR to see if it has switched to a rotational mode. If trend is continuing, start looking for first retracement  trend entry opportunity on the 5 min chart.  Have patience and implement DISCIPLINE…you want to wait for a clear pullback opportunity. If you trying jumping in on breakout/breakdown moves, you run the risk of staying in the trade too long and getting your stop hit. You want to see at least 100 differential of the Early Warning 5 period CCI and the 14 period CCI on the 5 min with a sharp "V" or Inverted "V" with a cross of the opposite end resistance line to have a proper setup. Always wait for this as your first trend trade setup…even if it takes 2 hours to trigger. Remember to wait for a Close on the 5 min chart to determine if CCI has crossed the resistance line.

Pay attention to the price at the OPEN, write it down. You want to know what is the most likely test to the high side from this opening price AND what is the most likely test to the downside from this opening price. This is usually the point where you will notice a shift from a trending to a rotational market. Also, pay attention to see if the %K/%D on the 5 min chart are going to the 50 level, if so check to see if 15 min trend is still valid or to see if it is shifting to a rotational mode.