I did not take a trade yesterday. My primary Edge: The Cusp Trade formed before Powell started his testimony in front of the senate and I wanted to wait to see the market action that followed. In retrospect, that was the wrong decision, but obviously I don’t have a crystal ball. But for those of you that trade my Edge and were nimble enough to enter the market when it formed perfectly on the ES and NQ chart concurrently at 9.46 a.m. you must’ve had an outsized day, especially in the NQ. The market got away from me and I decided to sit it out.
There are far better futures traders than me that don’t listen to the news or give any credence to fundamentals before they enter the market. I am not one of them. I strongly believe and have evidence that news/fundaments drive price, rather than pure technicals. Thus, I wait for the market to play out after it digests the news and wait for my edge to form. But there are days like yesterday, when the edge forms perfectly that you must take the trade. Edges appear sporadically at best. They are not a regular occurrence. Especially the best ones when price is already moving in the same direction as the pullback, that is a high probability chance that it will continue in the same direction.
Keeping with that theme I waited for the JOBS numbers to be released pre-market. Even though the 275K number was above what the street was anticipating it wasn’t a blowout number like in February. Also, the February number which was 353K was revised down to 229K, and average hourly earnings are down to 0.1%, the unemployment rate increased to 3.9% from 3.7% in January. This marks the first increase in the unemployment rate in four months, as it now sits at its highest level in the last two years.