A COMPLETE DAY WITH THE BOTS

Tonight, just a look at the charts.  Excellent day for traders with BOT BO's, 50CB's, and MAXT's.  Trend runs and quick sniper trades.

TODAY:    NQ  ES  TF

WHY BOTS ARE 24 HOURS

THE 8/30/11 BOT levels provided another launch in the after hours , for  a +5/+10 run.

A NEW BEGINNING FOR BOTS

Just a note to all the traders that drop by to check us out.  I appreciate your interest.  It is now time for the BOT Trading System to venture into a new arena.  Effective immediately, we will begin promoting the BOT System, as opposed to focusing upon CM or Chartmaster.

The BOT System was originally designed to run one year, to allow adequate time to tweak, improve, and/or verify results.  It is my belief  that the results have been sufficient to warrant going private.

Additional information will be coming out soon, to address an affordable and reasonable way to add to your trading experience,

Again, thank you to the many viewers that has helped make this venture a fantastic journey.


Be sure to see our new blog site,    http://.bottradingsystem.blogspot.com

40 POINT RANGE DAY

40 point range day.  Professionals moving the market down, then up.  What's a trader to do?



Some comments from the chat today:


 [09:22] <Chartmaster> per prior ema continues to be resist  note the maxt pb at 910-915  +5 be/10 in play

[09:24] <Chartmaster> y-day was another trend day  with a bo expected  the sb failed into the after hours  and today may well be a cont(inued) bo

[09:26] <Chartmaster> the actual watch for today is not the bo:  will look to see if price holds at the +5 or +10  and runs to a +5 lbbo   there will be 15/20 points today by the pros  one way or the other

[09:28] <Chartmaster> mkt open in 3 min

[10:21] <Chartmaster> pros have sbbo +20  now a +10 reversal  inverted h&s would be complete just above the sbbo5

[10:23] <Chartmaster> not disclosed anywhere, but the bots track (confidential  text deleted)  and they are going for 20/20

[10:27] <Chartmaster> the 50cb is now +12  sbrev  +3  approx

[10:27] <Chartmaster> point: pick the entry you feel more comfortable with

[10:29] <Chartmaster> it is no coincidence that the 50cb is at/near the sbbo10

[15:42] <Chartmaster> another nice range day  approx 40 pt range 

Have a plan.  One that tracks the pros.

RANGE-BREAK OUT-RANGE

We had two range days that ran LBBO+ to SBBO+, and a watch was issue each day for a break out/  Yesterday we saw that BO.  Today, back to a range day LBBO 5/10  to SBBO +5/10.



PA moved inside the BOT range and we see an early FBO of the SB.  It was interesting to see price hit a 50CB, MB, and EMA BO in the same general area.  This frequently happens with the BOT levels.  The FBO combined with the other long signals created the first trade long at the 50CB.

The favored trade continues to be LBBO or SBBO for +5, with a runner set to BE or +10.  The first to hit, exit the trade.  Naturally,  any profit above the +5 is a personal decision as to when to exit the trade.

Next, look for the reversal trade like the 50CB at B2, which was a minimum short to the EMA, which again was very near the LB.  B3 and 4 failed to reverse the LB.  B5 resolved any doubt about shorting ( it could bounce for another bull run).  PA consolidated B7-10 with two FBO of the SB.  This also completed a H&S pattern back to our original entry point, and developed as a TC (trend continuation).

SBBO, TC, H&S.  Coincidence?  BOTs work. Period.

Again, standard +5/BE10 preferred play.  The +5 and +10 lines were on the chart well before the PA  reached those points.  The +5 was a fail BO of the EMA, and the +10 area was a consolidation BO of the EMA.  Point?  These area are important for a reason.  Play the 5/10 up or down, and the reversals.

THE BREAK OUT WATCH HITS

FOR two days we have had a trending day locked in a + LBBO to a +SBBO range.  Both days we mentioned in the chat, and the blog, to watch for a significant BO.

From the Range Page in this Blog:  posted targets and the close

DAILY RANGES (break out targets)

Updated at 7:15 AM EST            

*note  BOTs are for the entire period until new range is calculated

8-24-11 BREAK OUT WATCH

ES upper: 1153            1171

6E# upper: 4432          4390*    LBBO then reversal sell off

YM upper: 11086         11263

NQ upper: 2113.5         2139

TF upper: 677.8          688.1


Thanks to all that are making the blog a success.  The 3 digit hits per day are appreciated.

ES

This is the chart pic posted in the chat room.  It was first posted with arrows at key points, with a question thrown out for members to identify why the selected areas were important.  The answers are on the above pic.

 The BO watch was on, and we see an early LBBO.  The market stayed in the bullish-biased Upper Trading Range.  The open was important due to the failed reversal of the LONG BOT (LB) at the end of the consolidation.  BOTS work. Period.  We have a BO and a strong support- even stronger than the EMA.  The BOT was a long at the BO and at both failed reversals.

YM

NQ

 NQ actually tested the pre-open low to complete the H&S variation, yet the EMA remained bullish biased and the second LBBO was at the EMA too.

ANOTHER TREND DAY BOT BO'S

WE issued a watch yesterday.  We had a trend day (+5 LB BO and SB BO) and expectations were for a significant BO to follow.  How about a +15 SB BO followed by a LB BO?  Another trend day which means we will issue another watch for a BO.

Price broke below the EMA MB early for a SB BO.  The next play was the 50CB PB back to the EMA for the exit.  The 8:15 area was a MAXT at the EMA/SB  and a FBO of the EMA and a failed SB reversal.  Pick your read, as it was an over whelming suggestion for more shorting.

The +5 levels were put on the chart, and quickly hit prior to the US open.  Since we were looking for a significant BO, the +10 or more was not a surprise.

B7 begins a leg 2 from the LOD, that also broke the EMA.  This came after a MAXT variation at B2-3, where we also see a 50CB break of B2, and a long signal to test the SB.  The SB reversal was confirmed at B14, with a mirror move to the Middle BOT.  The mirror is:  we enter the BOT range from a LOD, and it will test the MB.  Two options are:  a continuation higher, or a failure to retest the LOD.

We see a trend continuation with the EMA as support.  The next SB reversal confirmation hits at B24, and is the right "bookend" for the mirror PA.  The mirror is confirmed after we have a LB BO with a PB test.  That test did what?  Pulled back to the Middle BOT.  Again, two options:  hold and trend long or fail for a move to the SB and potentially the LOD.  We see the MB hold and the bull trend continue.  The mirror then, is a low to mid (or high to mid)  followed by an offsetting move (high to mid in this case).  It can be considered as a variation on consolidation, where the market hits a perceived critical area, often within the BOT ranges by the way, and then makes it's (the market) next move.  B60 was the long clue, as it was the mirror BO at the LB and the EMA.

RANGE DAY BOT BREAK OUTS

WATCH ISSUE:  A watch exists for the break out from the ES range


The early LBBO ran to +5 to the tick before a 50CB reversal returned price to the LB.  The EMA continued to hold price for the best trade of the day, the reversal from the LB to the SB.  The SBBO ran +5, creating a trade range day.

Range days are playable, but the greater benefit is looking for the break out from the range.  They tend to be significant runs.

WHEN A NET ZERO DAY IS GREAT

From the early BOTs to the end of the day, the net for the market was negligible.  But the BOT BO was super.  Nothing new about that.

PA stalled at the MB, and moved upward along the EMA for the first +5 move.  Not listed, but you should see the 50CB reversal with a brief consolidation at the LB followed by a move back to where we started.

B2 launched the second +5 and hit the +10 area, but was more like the +9 exit from yesterday.  B3 to B5 was a +10 to LB pullback.  This is a green light for another long.  EMA at the LB.  This is a classic entry in leg 2 away from the EMA.  +10 and +15 were quick to hit.

The 50CB was a great entry, and price moved back to the +10 area where we see a consolidation.  Consolidations have been discussed in prior blog posts.  This consolidation was the trend continuation variation back to the LB.  A final failure at the EMA MAXT, and we reverse back essentially where we started when the BOTs were calculated.

ES

Here is the YM.  Add the BOTs and see how the day developed.

BOT BREAK OUT AFTER A RANGE DAY

A line from the Wednesday August 17th blog.

All-in-all, a range day with BO's on both ends into the UTR and LTR. A range day waiting for a break out. Tomorrow's BOT may offer a clue, and we will look for a tight BOT range that can be easily broken.

Yesterday PA broke the Long BOT (LB BO) and trended for the +5 and +10 targets.  It actually hit about +9.  We then had a 50CB reversal and eventually had a +5 Short Bot break out. (SB BO).

BOT ranges are set for the entire trading period, and are valid until a new set is calculated.  Some will remember the trial we had with after hour BOT levels that helped identify a nice BO for us.

In the after hours, PA broke the SB once again and trended downward for an additional +5 and +10 run.

The BOTs for today were set early.  The 5/10 run yesterday into the Upper Trading Range (UTR) combined with the +5/10 run into the Lower Trading Range (LTR) was suggesting that we would see a significant break out.

We got our wish, fulfilling the above statement for a tight BOT band BO.

 

ES

 

NQ

YM

RANGE DAY AND THE BOTS

WE become accustomed to a BOT BO  with a +5 and +10 trend following.  Today, PA did long with a LB BO to +5, then failed about a point short of the +10.  Price began to consolidate and by b12-14 we have a 50CB setup inside the consolidation range.

The short moved back to the LB where the PA found support.  It was stated in the chat that bulls are looking to establish 1200 again as a base.  This close, the bears will continue to push price away from the 1200, but eventually will give in.

By the b25-26 area we see a LB Reversal with target 1 and T2 set.  An earlier stop prevented playing those targets, but they were presented in the chat, and they did hit.  T1 and T2 should hit based upon our belief that a BOT reversal tends to run to the opposite level.  In this case, the LB to the SB.

The SB provided support, and was a long consideration.  Reasons included a 20 point run from the HOD, the two LOD test candles, and the SB support.  The ratio was 5:2 (five points to the EMA and two points to the LOD).  Another trader noted the 50CB as well, and took that long.  A good read and trade.  The point being, if you are not sure of the BOT entry, other setups appear and should be considered.

The SB long exit was a tick or two below the EMA, where we see a EMA/MB resistance that providing selling to retest the LOD.

A new LOD was established at SB +5, and then reversed to establish a "W" pattern test of the 50CB.  Once a 50CB is set, it is worth monitoring.  Another SB long was taken with a T1 at the MB.

All-in-all, a range day with BO's on both ends into the UTR and LTR.  A range day waiting for a break out.  Tomorrow's BOT may offer a clue, and we will look for a tight BOT range that can be easily broken.

WHAT ARE BOTs ?

From time -to-time a question comes up about the BOTs.  Frequently, the question shows a confused understanding of what the BOTs are actually reporting.

 BOTs are not used for trend or channel BO's, or similar BO's.  Traders can point to numerous BO's of this type that fail;  fail enough that it is difficult to correctly predict when one will not fail.  Most will wait for a clear BO, then participate on a PB.

 BOTs are calculated prior to the market open and are used to segregate the market into three zones:  Bullish, Neutral, and Bearish.  The "break out" in  Break Out Targets (BOTs) refers to the calculated price points that professionals will move the market into the Upper Trading Range (Bullish) or the Lower Trading Range (Bearish).   A LB BO is that point that suggest the bulls will push the market higher, and the SB BO is the opposite, the bear sell off.  A failure at the BOT or a reversal from a TR into the BOT is expected to run to the opposite range.

In the current market, a BOT BO is expected to trend for +5 to +10 for the ES.  Today it hit early in the trading day, then was available later in the PM when we discussed a trade where the EMA had moved into the UTR and price held at the Long BOT.  Price was expected to move higher to test the 50CB level.  Today, we see 50CB setups at the +5 and +10 levels.

BOTs look at the BO in the market.  The point where the bull or bear will take command.  No questions about entering above or below a bar, or is B4 a XYZ or a ABC.  No bar counting, or is the MACD positive, nor any of the host of trading techniques/systems/indicators.  I was reading some commentary, and it usually goes like this: "" shoulda went long at x; this looks like the low  going long here";  more low.  The point is, most traders, and I assume they are trading, seem preoccupied with the high or the low or what is bar 4 doing. Just seems like too much confusion and doubt, and that is not healthy for trading.  This discussion goes on when price runs to a BOT, reverses at a BOT, breaks a BOT, or rises/declines to a BOT where it often stalls and reverses.

 BOTs take away the confusion, the doubt.  If a reader of this blog has not seen that, or practice with the BOTs, then there is nothing else to say.  You will try it or you will ignore it.

FOLLOW THE RULES, NOT THE PLUS/MINUS

The BOTs are set and we look for PA to complete a break out.  In between, we can see failed break outs, and runs from one level to another.  In all cases, we have rules:  rules based upon observations about price action.  Don't worry about the daily plus or minus run in the market.  Look for the break out, look for the trend.

 BOTs set for the markets

TF

TF had an early FBO, and moved to the opposite level.  The SB did break, but quickly showed a reversal.  Reversals tend to run to the opposite level, thus was a long indicator.  A long was warranted by the LB BO.  The EMA moves into the UTR (upper trading range) indicating the market as a whole is bullish.

After the BO, continue to look for MAXT, 50CB, Trend Continuation, etc.

ES

The SB held, followed by a run to the opposite level, a long indicator.  The LB BO was a long.  By the consolidation, the EMA moves into the UTR for a bullish bias.

The 50CB held for additional bear selling, but this was stalled at the LB.  When the 50cb was broken, it was another bullish indicator.  This break is followed by a trend with the EMA as resistance.

The +5 and +10 LB BO was hit early, and was available in the trend run after the LB held.

TRADE WHEN YOU CAN

Today was a travel day, returning from a conference.  When an event conflicts with your trading time, you essentially have two choices:  trade before or after the event, or don"t trade.

With the BOTS, I will always check the market before/after the event.  Trading is trading.  Don't lock yourself into a set time.  I know most will trade the local time for their market of choice.  But do practice in other time frames.  There is no reason stopping you from a career in your profession, and in trading.  Those that are determined to succeed will make the sacrifices to get where they need to be professionally. 

The BOTs were set, and shortly thereafter we had a LB BO for a quick +3.  The market bias was set long early by the BOT ranges, and reached the +5 and +10 targets seen in the current market environment.

TF

TF had an early LB BO, and a 50CB level set.  The MAXT reversal at the 50CB level returned to test the SB.  When a range holds, or has a FBO,  it is believed that PA will return to the opposite range.  There was a consolidation between the LB and the MB, which broke to the upside for a trend continuation.  PA returned to the 50CB level, the resistance for the day.

The SB to the 50CB, or the SB to the close were valuable trades today.


ES

The ES broke early, and hit the +5 to +10 targets before the open.  Trade this, and go to work.  Those that want it bad enough, will do what is required to be successful.

The reversal was to the MB, and it began to channel back to test the HOD.

EARLY BOTS CAPTURE BOTH MOVES

WITH the recent volatility in the market, the BOTs were calculated early.  Early enough to capture both tremendous moves in the market.

The Short BOT broke first.  News from Asia,  reports were flying that banks were holding credit to banks in France.  The sell off had a PB to the EMA/50CB area fail as a MAXT, with a retest of the LOD.

That same 50CB was a BO at the EMA for a long run to the SB.  By the open, we had a reversal of the SB, with a PB to the EMA that was reversed by another MAXT.  A reversal is expected to run from one BOT level to the opposite.  In this case, that was the Long BOT.  Price was supported by the EMA after the LB BO.

In both cases, the BOT ranges helped identify entries for extended runs.  When a BOT breaks, a trend is expected to develop.

Another point, when price consolidated (bars 265-270) we look for the break out direction.  We see the BO reverse  (BO was a reversal of the entry) rather than being a trend continuation BO.

BOTs are developed to analyze how the markets (professionals) are expected to "behave" when price hits key targets.  Add a few setups (i.e. 50CB, MAXT, etc.) and we have (opinion) an advantage in trading the markets.

ES

TF

NQ

AFTER BOT BO AND TREND: THEN WHAT?

DEPENDING upon the time you begin your trading, the charts will tell a completely different story.  Has there been a large run up or down?  Has there been a news event?  Some government announcement?  Or has the the market been consolidating?

When you start has a bearing on your trading.  Using RTH or GLB charting will effect your processing of the data.

The preference in this blog is to use GLB charts, and to use Break Out Targets (BOTS).  But what do you do after the break out and a trend is well developed?

The preference is to look for a failed break out (FBO) of the EMA and/or look for a 50% Control Bar (50CB) entry.


TODAY:

Price action (PA) was drifting lower in our initial ranges.  The Market as a whole became short around 8:55 AM EST.  This is when the EMA crosses the short BOT (SB) into the Lower Trading Range (LTR).  A cross of the Long BOT (LB) into the Upper Trading Range (UTR) creates a long biased market.

BAR 263
The SBBO was a playable trade, however the first trade today was the SBBO reversal long to the EMA.  In this case, the 50CB was the SB.  A MAXT developed (BAR 265-66), suggest a EMA FBO and a reversal.  The SB (bar267) was shorted with +5/+10 targets.  When we have a BO, a trend is expected to develop.  Under current market conditions, that trend is expected to be for a minimum of +5 and +10 points from the BOT BO.

BAR 277
Price began to stabilize around 1144-45 where we see a variation of the MAXT.  In a strong trend, the MAXT is more likely to be a pull back (PB) signal, rather than a strong reversal signal.  The target was set at the +10 level where the EMA was anticipated to be pulled to for an exit.

This is the first entry for those that missed the SBBO and trend developing. Look for the EMA FBO and/or 50CB's.

 It failed to hit exactly, but sufficient to allow profit on the trade.  The failure also was a clue that the PB was weakening, and a short was anticipated at the same 50CB level 1146 (bar 1).

BAR 2

Price was again in a PB mode.  The new 50CB was at 1143 with T1 and T2 targets set.  It is believed that a new 50CB will often retest a prior 50CB level.  T2 was at/near a EMA and deemed a FBO for a 50CB (1143) short on bar 6.

Price continued down to the 1125 area, and did retest the 50CB level(1143) at b14

Break outs, trending lower.

PA moved into the LTR.  Markets in short bias.

TREND CONTINUATION AND THE BOT

Yesterday, we briefly discussed finding value in all the fear.  Today was a pay off for that search.  Yes, it is too soon to announce a bottom.  But values were there, and still are available.

Today, we see an early trend move that consolidated at the Middle BOT (MB).  Two outcomes have been discussed in prior blogs:  a trend continuation, and a reversal.

The MB held with a MAXT, and we have additional long ammunition in the 50CB.  This was believed to be a strong key to a TC long to the LB.

Essentially, trading is over for the day until the FED News (if any) this afternoon.

Key moves in all markets.  Today we had a nice spread in the ranges, the first we have seen in some time.  Most prior ranges were much more narrow, for quick entries in the selling.

Strong entry signals, with range to range trading.

MARKET SELLOFF AND THE BOT

The news channels were on all evening talking about the sell off.  Yes the rating was changed, yes the market was selling.  Best values for key stocks that we have seen  in some time.

Only an idiot thinks the market goes up forever, or down.  You must look beyond the talking heads and look for value.

In trading, we continue to use the Break Out Target Ranges:  BOTs.

The Short BOT was tested, then we had the BO.  Trend got the +5 and +10 targets expected.  We see a reversal at the +15 level, with a two leg push back to the SB.  Generally, the second leg is the preferred trade for the reversal.

The +10 level was acting as a 50CB.


THE FINAL LOOK

The market failed to reverse at the SB, and continued to plunge.  The EMA acted as a barrier until the short bull PB at the end of the day.

These are special times,  Avoid the fear, and play the BOTs,  It produced the short to take, and it was later rejected:  more selling.